Morupule B P8bn contract dispute heads to Parly

Friday, May 26, 2017

The construction of Unit 5&6 at Morupule B is headed for a prolonged delay after it emerged this week that a P8.5 billion-guarantee dispute between government and the contractor that has stalled works so far will have to be resolved by Parliament.

Parliament is currently on recess and will only resume business in July. Japanese contractor, Marubeni and Co. was last year awarded the tender to expand Morupule B power plant by another 300MW (Unit 5&6), but, at the last minute, demanded a P8.5 billion ($804 million) surety upfront as security for any potential payment defaults by the Botswana Power Corporation (BPC).

Unit 5&6 is Botswana’s first Independent Power Producers (IPP) project where the contractor funds the construction of the power station and recoup their investment from selling the power to BPC.

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Morupule B P8bn contract dispute heads to Parly

The construction of Unit 5&6 at Morupule B is headed for a prolonged delay after it emerged this week that a P8.5 billion-guarantee dispute between government and the contractor that has stalled works so far will have to be resolved by Parliament.