Project highlight: Mozambique’s Central Térmica de Temane

Mozambique

Central Térmica de Temane (CTT) is a planned 450-MW gas-fired power plant in the Inhassoro district of Inhambane province. Once operational, CTT will generate enough power to supply an estimated 1.5 million households and mark a substantial step towards overcoming Mozambique’s electricity deficit.

CTT will generate electricity using natural gas sourced from the Pande and Temane fields, operated by ENH and South Africa’s Sasol. In addition to new generation capacity, the project will add transmission infrastructure that will contribute to reinforcing the stability of the national grid, a key element towards achieving Mozambique’s 2030 electrification targets.

SPECIFICATIONS: The power plant proper will be a state-of-the-art facility equipped with Siemens SGT-800 gas turbines, steam turbines and a heat recovery steam generator for a total output of 450 MW. It will also be fitted with an emissions monitoring system and raw water treatment equipment.
CTT will also comprise the Temane Transmission Project (TTP), a 563-kilometre high-voltage transmission line connecting the power plant to the central and northern segments of the national grid, for subsequent distribution nationwide. CTT will supply electricity to EDM under a 25-year tolling agreement, with the power evacuated through a 25-kilometre 400-kV transmission line lining the plant to a substation in Vilanculos.

KEY PLAYERS: CTT is 85% owned by Mozambique Power Invest, which is in turn owned by Africa-focused independent power producer Globeleq (76%) and Mozambique’s national electricity company, EDM (24%). The remaining 15% stake in CTT is held by South African energy and chemicals company Sasol.
Spanish engineering and industrial construction company TSK was awarded the contract for the turnkey execution of the facility in 2020 for a total consideration of approximately EUR 300 million.

INVESTMENT: Debt financing for the USD 652.3-million project is being provided by numerous international institutions. The IFC together with FMO, a Dutch development bank, and Emerging Africa Infrastructure Fund is providing USD 253.5 million, the US International Development Finance Corporation is responsible for approximately USD 191.5 million and the OPEC Fund for International Development contributed USD 50 million.
The Multilateral Investment Guarantee Agency is providing up to USD 251.3 million in political risk insurance.

SIGNIFICANCE: CTT aligns with National Energy Strategy objectives of boosting electricity generation, diversifying the energy sources that contribute to the national mix and improving grid infrastructure. The plant will help to meet growing domestic demand with electricity derived from cleaner fossil fuel sources.
TTP, meanwhile, is a priority project for the government of Mozambique, as it will provide an anchor for the growth of transmission and distribution networks regionally and nationally, establishing a corridor of electrification to drive forward the government’s universal electrification goals. It will also facilitate the incorporation of renewable generation assets into the country’s portfolio in the medium and long term.
The work towards the implementation of both projects will bring important economy-wide impacts in the form of demand for domestic goods and services and the creation of jobs.
At the regional level, the project’s cost-efficient and reliable electricity supply will deepen Mozambique’s integration with the Southern African power market. CTT’s configuration allows for variable supply, which can be deployed as either baseload power or to satisfy demand peaks, thus improving the liquidity of regional electricity markets.

Photo courtesy of Globeleq

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