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Japanese Firms Wins Preferential Negotiating Rights to Build Hydroelectric Power Plant

Mozambique's Ministry of Mineral Resources and Energy announced on May 26 that it has selected a consortium led by Electricite de France (EDF) as the preferred negotiator in a bidding process to select a strategic partner for the Mpanda Nkwa hydroelectric power plant construction project. The consortium includes French resources giant Total Energies, Sumitomo Corporation, and Kansai Electric Power Co. The consortium consisting of United Arab Emirates (UAE)-based ETC Holdings, Zambia's state-owned electricity company Zesco, Secot, a local subsidiary of Portuguese construction giant Mota-Engil, and South Africa's state-owned oil company PetroSA were named as the runner-up preliminary negotiators. PetroSA, South Africa's state-owned oil company, was nominated. The selection process for the strategic partner began in June 2022, with proposals from candidates closing on March 10, 2023.

The Mpanda Nkwa hydropower plant, which will have a maximum capacity of 1,500 megawatts, will be constructed on the Zambezi River, which flows through the northern interior Tete province, 61 km downstream of the Cahora Bassa hydropower plant (operational since 1975, 2,075 MW capacity). The project also includes the construction of a 1,300-km high-voltage transmission line from Tete Province to the capital city of Maputo, at an estimated total project cost of $4.5 billion. The Mozambican government has described the project as a cornerstone of the decarbonization of Southern Africa, contributing to the promotion of domestic electrification and the export of electricity to neighboring countries.

To implement the project, a public-private partnership (PPP) joint venture, the Power Plant Management Company (HMN), was established. The consortium will own 70% of the company's shares, while the Electricity of Mozambique Corporation (EDM) and Cahora Bassa Hydroelectric Power Plant will each own 15%. The consortium, which has become the preferred negotiator, will now move on to contract negotiations with the Mozambican government.


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