Stiegler’s Gorge Dam to cost more than double government estimate – study

Tanzania‘s Stiegler’s Gorge
Dam, due to be built on a Unesco World Heritage site, will cost more
than double the government’s estimates, an independent study showed on
Thursday.

In December, Tanzania signed a
deal with two Egyptian companies, El Sewedy Electric Co and Arab Contractors, to build the
$3-billion hydroelectric plant.

Joerg Hartmann, an
independent expert and assessor on the sustainability of hydropower projects, said the dam
was likely to cost $7.58-billion once financing and other costs were taken into
account, rising to $9.85-billion on account of cost overruns associated with
such projects.

His study was published by OECD Watch, a worldwide
network of civil society organisations with more than 130 members in over 50
countries.

A spokesperson for Tanzania‘s power utility
Tanesco, which is implementing the project on behalf
of the government, has not responded to a request for comment on the study’s
findings.

The costs of projects of a
similar scale commissioned between 2010 and 2017 had risen by 31% on average,
the study found, citing the International Renewable Energy Agency.

Known for its elephants, black rhinos and giraffes,
the Selous Game Reserve in which the dam will be built, covers 50 000 km² and
is one of the largest protected areas in Africa, according to
Unesco.

The study was released on the day Tanzania handed
over the construction site to
El Sewedy and Arab Contractors, ignoring
concerns about its potential impact on wildlife.

Arab Contractors disputed
the study’s higher price tag for the dam, saying the highest bid for the project was
$3.2-billion and that their bid was roughly $2.9-billion.

“Is it reasonable that all these companies
that bid – big companies and from different nationalities – all of them did not
know how to value the project and study
it correctly?” said Osama Ali, spokesman
at Arab Contractors.

The project will
generate 2 115 MW of electricity when it
is completed, energy minister Medard Kalemani said
during the handover ceremony.

Hartmann, whose work experience on dams spans 24 years in 45 countries, has worked for the International Hydropower Association, the World Bank and Asian Development Bank, Indian state-run utility NHPC and Zambia‘s Western Power Company and Mekong River Commission of Laos, among other organisations. http://www.engineeringnews.co.za/article/tanzania-hydropower-dam-to-cost-more-than-double-government-estimate-study-2019-02-15