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Deadline approaching: Transaction advisor sought for Mphanda Nkuwa

The Government of Mozambique, through the Ministry of Mineral Resources and Energy (MIREME), invites expressions of interest by 22 March from international consultants to provide transaction advisory services for the development of the Mphanda Nkuwa hydropower project on the river Zambezi.

The Mphanda Nkuwa project, with an installed capacity of not less than 1300 MW, of which an estimated 760 MW is expected to be firm capacity, is to be developed about 60 km downstream of the Cahora Bassa dam and hydropower plant by the state power utility Electricidade de Moçambique (EDM), Hidroeléctrica de Cahora Bassa (HCB), and a strategic partner on a limited recourse project finance basis, according to the tender notice published on 4 March.

MIREME said it seeks to engage a transaction advisor to advise on the commercial, legal and financial structuring of the project.

The transaction advisory services are divided into three phases. In a first phase the selected transaction advisor will be expected to support the Mphanda Nkuwa Hydroelectric Project Implementation Office, Gabinete de Implementação do Projecto Hidroeléctrico de Mphanda Nkuwa (GMNK), to prepare the Terms of Reference for the critical technical studies and in the resolution of aspects relating to the current concession.

In Phase II, the advisor will be required to assist the GMNK with the selection of a private strategic partner/investor and to integrate the firm responsible for the operation of the Mphanda Nkuwa facility as an independent power producer and, in Phase III, to support MIREME, EDM and HCB in the preparation, negotiations and finalization of the framework agreement, joint development agreement and any ancillary documents that are required to establish a special purpose vehicle with MIREME, EDM and HCB for the development and operation of the project. A maximum of six eligible firms will be shortlisted to submit a Request for Proposals for the services.

The Mphanda Nkuwa project has been prioritized in the recently approved Master Plan for Electricity Infrastructure for the period 2018-2043 to meet growing domestic demand and also for export to the regional market. According to current designs, the project will comprise a 103 m-high concrete gravity dam and will require a total estimated investment of US$ 2 billion. The associated transmission component foresees the construction of a 650 km-long, 400-kV high voltage alternate current (HVAC) line and two substations to connect to Cataxa (Marara) as well as a high voltage direct current (HVDC) line of +-550 kV and 1300 km long to connect to the Maputo substation and the South Africa grid. The total cost of the transmission infrastructure is estimated at around US$ 1.6 billion.

Expressions of interest for Project Reference Number 02/ MNK/2019 must be submitted in hard copy, one original and four copies, to Departamento de Aquisições, Ministério de Recursos Minerais e Energia, Av. Fernão de Magalhães No. 34, 8º andar, Caixa Postal 2904, Maputo, and also in electronic format to the address below. For further information, contact: