POSCO Energy has launched its power plant business in Africa, a land of opportunity. This is the first time a Korean energy company has made headway in southern Africa. POSCO Energy was selected as a preferred bidder of the fifth and sixth power plants of 300-megawatt Morupule B Phase II in the Republic of Botswana, ordered by the Ministry of Minerals, Energy and Water Resources of Botswana through a competitive international bidding.
POSCO Energy formed a consortium with Japanese general trading company Marubeni, each contributing 50 percent, to take part in the project, which is worth $800 million. POSCO Energy will jointly operate and maintain the power plants with Marubeni over the next three decades.
POSCO Energy plans to begin the construction of the power plants of Morupule B Phase II during the second half of 2016, and will start operation in May 2020. Special environment-friendly Circulating Fluidized Bed (CFB) combustion will be installed in the power plants to lower the emissions of pollutants such as nitrogen oxides and sulfur oxides. The plants will receive coal from nearby Morupule Coal Mine for smooth supply and delivery of raw materials.
GS Engineering & Construction Corp. will be in charge of Engineering Procurement Construction (EPC). Six hundred million dollars, about 80 percent of the total investment, will be financed by Export-Import Bank of Korea, Japan Bank for International Cooperation (JBIC) and an international commerce bank for project financing.
Botswana is the world’s second largest diamond producer and has a transparent administrative process and a stable political system. It is also showing rapid economic development, due to abundant natural resources. Botswana plans to build 1200-megawatt power plants locally by 2019 to deter dependence on imported power from South Africa, leading to high expectations for new business in the future.
“Being selected as a preferred bidder for this project is meaningful in that we have successfully entered the privately managed power plant business through international bidding in Botswana. Following this, we will establish a foothold to make forays into the power plant market in southern Africa and to make POSCO Energy a leading global energy company,” said Yoon Dong-jun, CEO of POSCO Energy.
POSCO Energy recently completed the construction of combined-cycle LNG power plants No. 7, 8 and 9 in Incheon, solidifying its position as the largest private energy producer in Korea. It is currently working on the construction of 2100-megawatt environment-friendly, coal-fired thermal power plants in Samcheok. POSCO Energy plans to grow as a globally integrated energy company through diversifying energy businesses in Korea and overseas, such as completing construction of the Mong Duong II Coal-Fired Thermal Plant in Vietnam and the CHP5 Coal-Fired Cogeneration Power Plant in Mongolia.
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