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Ministry of Minerals, Energy and Water Resources (MMEWR)
"Gov't in costly Morupule B political fancy footwork"
21/10/13
 

“Gov’t in costly Morupule B political fancy footwork”.

1. Project switched on before it was ready

2. Political decision expected to backfire

 3. Project failed commissioning specification output test

4.  Experts say it may be cheaper to build a new station than fix Morupule  B” refers;

The Ministry of Minerals, Energy and Water Resources is disappointed and saddened by the article that appeared on the Sunday Standard October 6th -12 headline titled “Gov’t in costly Morupule B political fancy footwork”. The article is highly inaccurate and contains non-factual information which is extremely misleading to Batswana and the public at large.

First of all, the Ministry has been transparent about the developments, progress and challenges that the Morupule B project is facing. The Minister has continually briefed Parliament, Batswana and the media on the project issues and progress from time to time and will continue to do so. All information requests on the same have been attended to, thus there was no need for anyone to speculate or give non-factual information to the nation. Secondly, the issues referred to in the paper have been clearly answered and clarified in the past. Thus the Ministry’s concern about the intent behind the dubious reporter’s article, with unconfirmed information, even though the Ministry is available to answer any questions or concerns.

We now state the facts as they are as previously stated by the Ministry on several occasions.

1. Project switched on before it was ready: Morupule B was designed such that the four 150MW units were to be commissioned one unit at a time at 3 months intervals, with takeover by BPC also happening one unit at a time, and final takeover and handover happening after all units have been completely commissioned, and working satisfactorily. This process has been delayed by about a year, as takeover of the units should have been completed by October 2012. Unit 1 was taken over on 21st July 2013, Unit 3 was taken over on 24th July 2013, Unit 4 was taken over on 13th September 2013 and Unit 2 is still being repaired following tube leaks in July 2013, it is expected to be taken over by the end of the year, all things being equal.

As previously communicated, the main challenges that have been experienced with the units have been the boiler tube failures, which have been attended to in the other operating units. Currently the 3 operating units are generating at their full capacity of 150MW each.

Construction of the power station itself is complete, which is why more than 90% of the project has been paid for, as is normal in construction or civil projects all over the world.

2. Political decision expected to backfire – Members of the Public are assured that no political decision was involved; as such an intervention would be inimical to the smooth execution of the EPC contract. This is an Engineering, Procurement and Construction (EPC) (Turnkey), in which risks are allocated.

3. Project failed commissioning specification output test. Members of the Public are assured that the three Units that are operational are generating their rated power output of 150MW with ease and have all gone through the commissioning process, which they passed.

4. Experts say it may be cheaper to build a new station than fix Morupule B - It is sad to have “Faceless Experts’’ making such an assertion when Generators, Turbines, engineering, erection and balance of plant, which constitute about 75% of the cost have, touch wood, hitherto performed flawlessly. We have a lot of confidence in our Advisers. In any case Units 3 and 4 have consistently generated 150MW. We expect Unit 1, which until its planned outage on 27th September 2013, consistently generated 130MW to be brought back into service and it will generate 150MW with ease. The last unit has suffered three boiler failures but on the same component. The Ministry and the parties involved continue to work with international experts to ensure effective solutions to these challenges. Experts from Germany and China are at Morupule B Power Plant to take a closer look at the problematic component of the Boiler.

It is a worldwide practice that projects funded through bilateral or multilateral lending agencies; with the 600MW Morupule B Power plant being a case in point is exempted from taxes. It is with this in mind that there is a USD 180.9million provision for the Government to meet Taxes and duties obligations at its equity contribution to the Project. BURS challenges currently being faced by the Project are procedural issues.

Public relations Unit Ministry of Minerals, Energy and Water Resources Tel: 3656641/6610/6659

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