Rural electrification scheme gets USD28m push

Source: The Guardian, July 03, 2007



The government`s rural electrification programme has received a major
financial boost from the mining giant, Barrick Gold Tanzania which has
injected USD28m into the national project.

The latest move comes in the form of public private partnership (PPP) and
would see Barrick Gold Tanzania extending electric poles all the way to the
remote Tarime district, Mara region, eventually integrating the area into the
national power grid.

The company would collaborate with the government through the Tanzania
Electric Supply Company (Tanesco) and an agreement was signed Friday to
usher in commencement of the project.

Speaking during the signing ceremony in Dar es Salaam, Minister for Energy
and Minerals, Nazir Karamagi, said after completion, the project would supply
power at competitive rates to North Mara Gold Mine in particular and to other
investment initiatives around the area.

The project is expected to significantly improve the financial health of
Tanesco as North Mara Mine becomes an anchor customer who is sure and
capable of paying bills appropriately.

The Minister said the electrification of the gold mine would enable Barrick
Gold Tanzania to access clean and cheaper energy source and would also
save the country millions of dollars spent on importing fuel to generate
thermal electricity.

In turn, he said, the foreign exchange thus saved would contribute
significantly to improving Tanzania`s balance of payments and to the stability
of domestic currency.

He said the fourth phase government is committed to expanding access to
electricity to rural and peri-urban areas.

``As you know such projects costs huge monies which the government alone
will not be able to execute at the expected rate but with such collaboration of
public private partnerships we expect to accelerate our programme``, he said.

The initiative would feed into government`s policy goal of increasing access
to electricity to 25 percent of the population by the year 2010. Currently only 10
percent of the country�s populace does have access to electricity and most
of it are urban dwellers.

He said with ongoing development in the power sector it is important to
ensure that there are sets of common and agreed principles to be followed
for the different stakeholders involved in the power sector in order to expand
access to electricity.

Minister Karamagi encouraged other investors to emulate the example
shown by the gold miner.
The mining sector is the fastest growing one and it challenges the
government to seek more investments to generate more electricity, feed it into
the grid and enhance access countrywide.

Gareth Taylor, the Executive General Manager for operations for Barrick Gold
Tanzania, said the project would bring the infrastructure for provision of power
to Tanzanians in the Nyamongo area earlier than may have been planned.

He said project implementation would commence as soon as after
completion of the Environmental Social Impact Assessment (ESIA).

This is a statutory requirement by the government which would ensure that
electrification of the mine would be conducted in a socially responsible and
environmentally friendly manner.

Speaking earlier, the Tarime legislator, Chacha Wangwe, said the project
would provide leverage for localized small and medium enterprises (SMEs),
in turn boosting incomes of the people in the respective areas.

Under this latest public private partnership scheme, North Mara Mine would
be allowed to consumer power freely for a certain period until its costs are
recovered, thereupon starting to pay power tariffs at the going market rates.