U.S.-based Albatros Energy is planning to construct a 230 megawatt thermal power plant in eastern Uganda in a bid to ease the country's power woes, the Ugandan presidency said Thursday.
Executives of Albatros Energy held talks with the Ugandan president Wednesday and pledged to build the plant on the existing equipment of a smaller plant in order to implement the project in a short time, a presidential spokeswoman said in a statement. The power plant is expected to be operational in 18 months, she added.
"We are happy to invest in Uganda and be your partners in development," Jim Gibbs, the company chairman, was quoted as saying.
President Yoweri Museveni said that the costs of power generation would go down once the country starts using its own oil and gas for power generation.
Uganda has discovered at least 2 billion barrels of oil in three blocks along its western border and the country is expected to start trial oil production this year.
U.K.-based Tullow Oil PLC which owns one block in the Lake Albert basin and co-owns the other two with Heritage Oil PLC, has already indicated that it will start supplying crude oil to thermal power plants in Uganda from its extended well testing this year.
Most of Uganda's thermal plants currently use heavy oils. However, once a supply deal is sealed with Tullow, some plants will be modified to enable them to use crude oil, according to people familiar with the situation.
According to the Ministry of Energy and Minerals Development Uganda has potential to generate at least 3,000 MW of electricity but only around 10% of this is being exploited. The country wants to generate more electricity to stimulate industrial growth. The 250 MW Bujagali hydropower project is expected to come on stream next year.
Uganda has been grappling with power shortages since 2005 due to reduced power generation at the country's main hydropower station.
