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The National Pensions Scheme Authority (NAPSA) has signed a financing agreement with Maamba Collieries Limited to invest up to US$200 million in debt financing towards the phase two project.
This expansion aims to increase power generation from the current 300 megawatts to 600 megawatts through the construction of a modern, technologically advanced and environmentally friendly 300 megawatts power plant.
The Maamba phase two project, estimated to cost up to US$400 million, would be financed through approximately US$300 million in debt and US$100 million in equity.
NAPSA Board Chairperson, Shipango Muteto, announced the development at a media briefing in Lusaka on Tuesday, stating that the decision aligned with Statutory Instrument Number 19 of 2017.
“The NAPSA debt is priced at 99 percent of taxes for a period of ten and a half years, including a two-and-a-half-year moratorium period on principal repayments,” Muteto said.
He added that the Maamba Phase Two project was projected to be completed within 25 months from the commencement date following the financing agreement signed on July 4, 2024.
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“The authority is projected to earn up to US$107.6 million in interest income from the project, with US$33.7 million expected during the moratorium period,” he highlighted.
Muteto revealed that the total recovery amount, including interest and principal repayments, is expected to be US$307.57 million over the loan’s tenure.
He stated that the project would hedge the portfolio against local currency depreciation and inflation due to its foreign currency basis.
“Maamba Collieries phase two will help diversify the country’s energy mix and reduce dependency on hydroelectricity, which is increasingly affected by climate change and erratic rainfall patterns,” Muteto noted.
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