A Review of the Nigerian Energy Industry

New firm takes over Tanzania’s Independent Power

Power transmission30 August 2013, Dar ES Salaam – Power production in Tanzania is set to increase following the acquisition of Independent Power Tanzania Limited, IPTL, by a new firm, that has promised to step up production from the current 100 to 500 megawatts.

The dispute surrounding the power production firm was finally resolved on Thursday after a new company, Pan Africa Power Solutions Tanzania Limited, PAP, took over its operations and promised to extend its capacity.

This was revealed in Dar es Salaam when a top official with Engineering and Marketing Limited, VIP, Mr James Rugemalira, announced his company’s decision to withdraw the petition for winding up of IPTL, which is pending before the High Court.

Mr Rugemalira, the International Independent Consultant with VIP, the minority shareholder with IPTL, also announced that his company has resolved to sell its shares to PAP after noticing that his co-shareholder, Mechmar Corporation (Malaysia) Berhard, did so in 2010.

In IPTL, VIP was holding 30 per cent shares, while Mechmar Corporation (Malaysia) Berhard, was the majority shareholder having 70 per cent shares.

The Executive Chairman and Chief Executive Officer Managing of PAP, Mr Harbinder Sing Sethi, said in a statement read during the briefing session that his company has resolved to compete with International Companies in the country.

According to his statement, PAP would cooperate with the government to address the persistent shortage of power, which has become an urgent problem to the Economic and Social Development of Tanzania.

“PAP is thankful to VIP for selling its 30 per cent stake in IPTL and for having taken the bold step of giving consent to PAP to buy from Mechmar Corporation (Malaysia) Berhard, the remaining 70 per cent shares to make PAP the 100 sole owner of IPTL,” he said.

He said that PAP has learnt with astonishment that presently the government and Tanzania Electric Supply Company Limited or Tanesco were buying electricity from independent power producers and emergency power producers at a shocking tariff of between 33 to 55 US cents per unit.

“PAP’s aim is to sell IPTL power to Tanesco at tariffs of between 6 and 8 US cents per unit by converting IPTL into dual gas and heavy fuel firing and expanding the capacity to about 500 MW within the shortest time from when the plant will be completely handed over,” he said.

His company, Mr Sethi said, has assured the workers of IPTL and the Ministry of Energy and Minerals that from now on, IPTL would operate as a private commercial entity so that all persons who have any claims should bring them with evidence.

The dispute surrounding IPTL has been pending for several years without being determined. Mr Sethi thanked the Minister for Energy and Minerals, Prof. Sospeter Muhongo, for initiating and firmly convincing VIP to withdraw the petition for winding up of IPTL in the public interest.

In the notice for withdrawal of the petition for winding up of IPTL, Mr Rugemalira requested the official receiver and provisional liquidator of the company to hand over all the affairs of IPTL, including the power plant to PAP to fast tract the conversion.

– Tanzania Daily News

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