Saturday, June 3, 2023
BusinessUSD 200 mln steel structure, Turbine deals for GERD

USD 200 mln steel structure, Turbine deals for GERD

The Ethiopian Electric Power (EEP) has inked two separate contractual agreements worth USD 200 million to revive and overhaul the hydraulic steel structures and electromechanical works that has delayed the construction of the Great Ethiopian Renaissance Dam (GERD).

EEP has accorded the German based Voith Hydro Shanghai Ltd to supply six turbine generator units together with the installation and commissioning works. According to the information EEP has revealed, the Chinese Voith will be receiving USD 77.9 million. Abraham Belay (PhD), CEO of EEP, and Voith deputy, Tang Xu, inked the agreement on Thursday. 

Similarly, last week, EEP has signed a deal with another Chinese firm: Power China, in which the later will construct the hydraulic steel structure component of the ill-fated GERD that was expected to generate some 6,400 megawatt of electric power by now. According to the agreements, Power China will finalize the steel structure construction by the end of June, 2020 and will be commissioning the entire project by the end of 2022.

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EEP agreed to pay USD 125.6 million for the hydraulic steel structure alone. Previously, GE Alstom— a US-French joint venture – acquired a EUR 53.9 million contract to install and commission six turbine units. Out of the five turbines, two will be finalized before 2020 to help early generation of 750 megawatts slated as the first phase completion of the project. So far, two companies have signed to install 11 turbine generators, each generating 400 megawatts of electricity. The three companies have inked USD 200 million and EUR 53 million so far.

Both the steel structure and the turbine generators are considered to be the most difficult segments of the dam construction. A few weeks ago, Sileshi Bekele, Minister of Water, Irrigation and Electricity, said that these jobs require high precisions referring to the badly executed works of the ill-fated Metal and Engineering Corporation (MetEC).

According to the minister the steel structure works have remained somewhere at 25 percent of completion. The civil work of the dam to which the Italian contractor Salini Impregilo S.p.A. was hired, has reached more than 80 percent. The aggregate work undertaken, however, hangs around 85 percent of the civil construction. In fact, originally, Salini was contracted to build the entire dam until the government took parts of the steel structure and electromechanical works to involve MetEC.

To its disappointment, the government is snatched all lagging projects from MetEC and hired EEP as the project owner to oversee the construction of GERD. Because of the delays, based on a value of USD 0.5 cents per kilowatt hours, the dam project could have at least generated USD 800 million, by now. However, the dam project has consumed some 98 billion birr and how much is required to finish the remaining 35 percent of the project is yet to be worked out. 

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