Supposing the Botswana Power Corporation (BPC) gives Doosan Heavy Industries Construction the go-ahead to overhaul and refurbish the Morupule A Power Station, “it should be feasible to secure the envisaged 90 MW generation capacity from three units by the fourth quarter of 2016 and a further 30 MW (making a total of 120 MW) by the fourth quarter of 2017.”
That revelation is made in an August 3, 2015 letter from BPC’s Chief Executive Officer, Jacob Raleru, to the Permanent Secretary in the Ministry of Minerals, Energy and Water Resources, Kgomotso Abi, in which the former provides a detailed evaluation of the proposal made by the South Korean company. However, the timelines are not definite as Raleru indicates that they don’t include the time necessary for procurement and implementation of the project activities to be undertaken by BPC in response to Doosan’s proposal.
“The time for the consent and approval processes at both Government and BPC levels has not been factored into the time line for project implementation described above. This implies that the project procurement timelines will shift to the extent of the approval processes,” the letter says.
While the Corporation’s Board of Directors is said to have initially resisted the Doosan deal, all indications are that it has fallen in line. At its July 29 meeting, the Board discussed other project approaches that have not been covered by the financial evaluation report. Such approaches are: adoption of the Doosan concept but reducing the scope of work for replacement or supply of new equipment; reducing the refurbishment scope to a maximum of three units in the best condition and requesting a phased unit-by-unit refurbishment concept in which one or two units may be put into operation earlier than the proposed 12 months; limiting the project aims and the refurbishment scope further to achieve only five years of reliable power generation; establishing alternative and reliable power supply sources to bridge the power supply gap and thus dispense with need to refurbish Morupule A; and as a variation of the latter, securing alternative and reliable power sources to allow an alternative approach to the refurbishment of Morupule A through, for example, “the engagement of Original Equipment Manufacturers.” With regard to the second approach, the letter notes that this option “would rely on new power generating capacity outside of Morupule A being available by the end of the five years.”
The Board is said to have questioned whether the reduction of the extended plant life from the original 15 to seven years didn’t compromise the original project objectives too much.
“In response, it needs to be considered that requiring an extended plant life of 15 years from DHIC in an amended proposal would not be constructive. This is because this would be a material deviation from the DHIC refurbishment concept. Such a requirement is likely to result in a significant increase in price and implementation time beyond the proposed 12 months period,” Raleru says in his letter to Abi.
The BPC CEO further states that the levelised electricity costs (LEC) have been calculated for seven years’ extended service life at 80 percent availability, yielding an LEC value of 11.3 United States cents per kilowatt hour.
