Malaysia venture seeks to build Uganda’s 350-MW Kalagala

Malaysian development venture Virtual Peaks Resources Sdn Bhd has applied for government approval to build and operate the 350-MW Kalagala hydroelectric project on Uganda’s Nile River.

Uganda’s Electricity Regulatory Authority reported receiving a notice of intention to develop the project from Virtual Peaks, a joint venture of Ranhill Bhd and Perspec Prime Sdn Bhd of Malaysia.

The firm seeks to develop the project on a build-own-operate-transfer basis at Mukono downstream of the 180-MW Nalubale project at Jinja.

Virtual Peaks seeks permission to carry out feasibility studies and to develop: a technical proposal for generation of electricity; a financing proposal with evidence of independent funding not needing Uganda government guarantees; a commercial proposal specifying a reasonable generation tariff; an environmental impact statement; and water use permits from the Directorate of Water Development.

In 2002, the World Bank called for a commitment from Uganda not to pursue development of Kalagala Falls for hydropower, in connection with bank support at that time of a competing project, 250-MW Bujagali Falls. At that time the bank noted Uganda had committed to set aside Kalagala Falls to protect its habitat, environmental, spiritual, and tourism values.

Currently the US$400 million Bujagali Falls project is being developed on the Victoria Nile River by Bujagali Energy Ltd., a consortium led by Industrial Promotion Services (Kenya) Ltd., a member of the Aga Khan Development network, and Sithe Global of the United States. (HNN 9/15/06)

For information, contact Chief Executive Officer, Electricity Regulatory Authority, ERA House, Plot 15, Shimoni Road, P.O. Box 10332, Nakasero � Kampala, Uganda; (256) 41-341852; E-mail: info@era.or.ug; Internet: www.era.or.ug.

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