Maamba power station

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Maamba power station is an operating power station of at least 300-megawatts (MW) in Maamba Mine, Sinazongwe district, Southern, Zambia with multiple units, some of which are not currently operating.

Location

Table 1: Project-level location details

Plant name	Location	Coordinates (WGS 84)
Maamba power station	Maamba Mine, Sinazongwe district, Southern, Zambia	-17.352722, 27.18594 (exact)

The map below shows the exact location of the power station.

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Unit-level coordinates (WGS 84):

• Unit 1, Unit 2, Unit 3, Unit 4: -17.352722, 27.18594

Project Details

Table 2: Unit-level details

Unit name	Status	Fuel(s)	Capacity (MW)	Technology	Start year
Unit 1	Operating	coal: unknown	150	CFB	2016
Unit 2	Operating	coal: unknown	150	CFB	2016
Unit 3	Construction	coal: unknown	150	CFB	2026 (planned)
Unit 4	Construction	coal: unknown	150	CFB	2026 (planned)

Table 3: Unit-level ownership and operator details

Unit name	Owner	Parent
Unit 1	Maamba Collieries Ltd [100%]	Nava Ltd [65.0%]; ZCCM Investments Holdings PLC [35.0%]
Unit 2	Maamba Collieries Ltd [100%]	Nava Ltd [65.0%]; ZCCM Investments Holdings PLC [35.0%]
Unit 3	Maamba Collieries Ltd [100%]	Nava Ltd [65.0%]; ZCCM Investments Holdings PLC [35.0%]
Unit 4	Maamba Collieries Ltd [100%]	Nava Ltd [65.0%]; ZCCM Investments Holdings PLC [35.0%]

Project-level coal details

• Coal source(s): Maamba mine

Background

The power station was proposed by Maamba Collieries Limited (MCL), the largest coal mining company in Zambia. The station is a mine-mouth and fueled by low grade coal, a by-product of mining at MCL's Maamba mine. The first 150 MW Unit was scheduled to be completed by October 2014, and the second 150 MW Unit by January 2015.

In 2011, MCL appointed SEPCO Electric Power Construction Corp (China), a large supplier of power generating plants, substations, and transmission lines, for implementation of the power project. The power was to be sold to Zambia Electricity Supply Corporation (ZESCO) Limited.

In a March 2014 investor presentation, Nava Bharat stated that the 300 MW power station would include a 50 kilometre long transmission line. The company stated that it had entered into a Power Purchase Agreement with Zambia Electricity Supply Corporation.

In 2016 it was announced that the EPC contractor for the project was PowerChina.

The 300 MW plant was planned for operation by 2016. On May 1, 2016, the project was reported as 90% completed, with unit 1 planned for commissioning in June 2016 and unit 2 in July 2016.

Units 1 and 2 were commissioned in July and August 2016, with commercial operation beginning shortly after.

In 2020, the company noted the baseload coal plant often supplies approximately 25 percent of the nation’s power. MCL also noted it faced maintenance challenges due to funding shortfalls, but recent tariff revisions should allow ZESCO to make timely payments and should help ensure proactive maintenance at the plant and reliability.

An August 2021 article celebrated the five year anniversary of the plant, stating that Maamba Collieries continues its commitment to supplying power to the Zambian grid. The article also highlights that the thermal power station helped to cut loadshedding by about four hours at the height of Zambia’s power crisis.

Reporting from January 2023 stated that scheduled maintenance at the power station had taken a 150 MW unit offline. Reduced power generation capacity countrywide had led to load shedding and a partial halt on electricity exports to neighboring countries. Maintenance was reportedly completed ahead of schedule and the power station had resumed operations in mid-January 2023.

Nava Limited's 2022–23 annual report stated that "major overhauls" completed during the year at both operating units of the power station had led to improved performance, increasing plant availability from 66.5% to 92%.

In July 2024, Maamba Collieries Ltd rebranded to Maamba Energy Ltd (MEL).

Phase II expansion

In 2017, MCL said it was engaging key stakeholders in the mining industry regarding the possibility of increasing the power station capacity to 600 MW "in view of the growing electricity demand in the country." The cost would be around US$850 million.

In 2021, an article noted the following: "[W]ith additional investment, Maamba Collieries, with its Zambia Environmental Management Agency (ZEMA) and World Bank approved eco-friendly technology, has the potential to double its 300 MW output and help Zambia take a step closer towards sustainable energy security and significantly contribute to Zambia’s aim of being an electricity hub in the region."

In December 2021, the company said that they were 'determined' to double their power generation with a 300 MW expansion. An article published in the Lusaka Times stated: "The Mining firm’s operations officer David Kumar has said that the necessary infrastructure is ready to undertake this huge expansion programme in power generation." The Sinazongwe District Commissioner confirmed the government's support and appreciation for the potential expansion.

A February 2023 investor report by Nava mentioned the power plant expansion to 600 MW but did not include any details on the expansion.

According to reporting from July and August 2023, Maamba Collieries had completed a technical feasibility study for the power plant expansion and was seeking support from the Zambian government in securing $300 million for the project.

A Nava investor presentation from May 2024 stated that the company was still "[w]orking on a brownfield expansion of [the] power plant by 300 MW."

In a press statement from July 2024, the Energy Regulation Board of Zambia said they had issued a construction permit for the 300 MW phase II expansion of the Maamba power station in the first half of 2024. In a separate statement from the Ministry of Energy, the Energy Regulation Board had apparently “stream lined the licensing processes in order to apply light handed regulations on entities that would want to set up generation plants,” to help address Zambia’s energy crisis fueled by severe drought. Construction was expected to begin in August 2024 and be completed in July 2026.

Foundation work on Phase II had reportedly started on schedule in August 2024.

Financing

Phase I: 300 MW

The estimated cost of the power project (phase I of 300 MW) was US$828 million. US$515 million in loans was provided by the Bank of China, Industrial and Commercial Bank of China, Industrial Development Corporation of South Africa, the Development Bank of Southern Africa, Standard Chartered, and ABSA Bank in 2015. It was reported that US$315 million in equity funding was provided by Indian conglomerate Nava Bharat Ventures, which would own a 65 percent stake in the project, and Zambian state-owned ZCCM Investment Holdings, which would own 35 percent. ABSA Bank, Barclays, and Cresco Project Finance acted as financial advisers.

According to a 2019 article, the Nava Bharat Ventures noted over US$900 million were invested to enable the plant to run at full capacity.

In October 2021, the government was aware of the plant’s financial struggles due to non-payment of full monthly invoices by ZESCO. The government was hoping that the country’s two largest power producers could come to an agreement on how the debt could be settled. According to a February 2022 investor presentation by Nava Bharat, the outstanding debt of the plant had reached US $413 million. However, Maamba's operations officer has said that there has been "commitment shown by the government to clear the outstanding 400 million dollars owed by ZESCO for electricity supplied".

As per February 2023 investor presentation, the focus is on de-leveraging: at present, outstanding debt stands at USD 383 million with USD 207 million successfully repaid since 2017. Owing to pending receivables from ZESCO, five loan instalments were overdue. Debt restructuring proposal was under active consideration of the lenders. There are no further capital infusions or equity infusions required from the parent company.

As per analyst call in February 2024, Maamba Collieries Limited has made substantial progress in repaying its long-term debt and is on track to achieve a debt-free status by the end of this fiscal year. As of summer 2024, debt of Phase 1 has been fully repaid.

Phase II

According to an October 2021 article, "[p]lans exist to double the plant’s capacity to 600 MW, which would be a significant boost to the national grid. However, this project has been stalled due to financial challenges the company is facing." According to reporting from July and August 2023, Maamba Collieries was seeking support from the Zambian government in securing $300 million for the project after Chinese lenders that backed the initial phase proved unwilling to fund the planned expansion.

In an analyst call in February 2024, the management of Nava Limited stated that the project cost is estimated at US$400 - $450 million and they are looking at a unique financing structure with the government. It will not be vanilla debt/equity structure that was followed in Phase 1 of the project.

In July 2024, Maamba Collieries has reportedly reached an agreement with anchor lenders to finance the construction of the plant. The project, estimated to cost US$400 million, would see a consortium of debt finance of approximately US$300 million. The National Pension Scheme Authority agreed to extend up to $200 million in debt financing. The balance of $100 million of debt funding was to be provided by other local investors. The remaining $100 million will be funded by equity with back-ended equity contributions at the end of the construction period), according to Nava Limited. Equity will be provided by Nava Bharat Singapore Pte Limited and ZCCM-IH in proportion to their respective shareholding of 65% and 35%.

In September 2024, it was announced that a new entity Maamba Energy Limited ("MEL") (formerly Maamba Collieries Limited) had reached an agreement according to which ZCCM Investments Holding Plc (ZCCM-IH) will contribute USD 15 million towards the debt portion in form of a loan that will have a tenor of 10.25 years from construction start inclusive of a moratorium of 3.25 years. The interest rate will be 9% per annum. It was not clear who are the other lenders providing the remaining USD$85 million debt portion.

Articles and Resources

Additional data

To access additional data, including an interactive map of coal-fired power stations, a downloadable dataset, and summary data, please visit the Global Coal Plant Tracker on the Global Energy Monitor website.