The Democratic Republic of Congo may soon conclude a deal that will see the country importing power from South Africa, with Congolese state-owned power company SNEL set to agree on a proposal for around 200 megawatts of power supply.
The country’s Chamber of Mines estimates that Africa’s largest copper producing nation would be able to boost copper production in 2017 by as much as 20 percent if the deal with Eskom is realized, according to IOL.
The power utilities from both countries have been in meetings during the past week in Johannesburg to iron out the initial details of the proposed deal, signing a provisional deal to move forward with the plans.
South Africa currently exports power to Swaziland, Botswana, Mozambique, Lesotho, Namibia, Zambia, and Zimbabwe, as these are all countries participating in the Southern African Power Pool, but a deal with the DR Congo would see yet another African nation become dependent on South Africa for part of their energy requirements.
South African state-owned utility Eskom has made 1000 megawatts available for export over the next decade, but the Congolese would only be able to accept 200 megawatts due to issues with the grid in the transmission network between DR Congo and South Africa.
Despite the issues, the potential for an extra 200 megawatts to be imported would benefit copper production, and that is a fact that excites Ben Munanga, chairman of the energy commission at the Congolese Chamber of Mines.
“There’s a deficit so any effort to bridge the gap is very welcome. If SNEL was a healthy organization that could import power itself and then redistribute, it wouldn’t be as difficult,” said Munanga, according to MiningNews.
While Eskom is ready to initiate the deal from the beginning of June, the Congolese will likely need more time than that. Trust issues between SNEL and the mining companies, based on previous failures to deliver promised energy supply, threaten to derail the deal unless guarantees can be made that financing the deal will result in adequate power supply delivered to the miners.
“We think two months is the minimum,” said Munanga when questioned on the timeline of such a deal.
Congo produced a record of 1.03 million metric tons of copper in 2014, with output falling to 995,805 tons in 2015 before increasing to 1.02 million tons in 2016. Without boosts in power supply, output cannot increase substantially going forward.
The imported power stands to increase copper output in the country by as much as 200,000 metric tons, so the incentives are in place for the miners to move forward with a deal.
Negotiations between the mining firms and SNEL will begin this week, as the miners will need to decide how much power they are each prepared to finance before the Congolese state-owned utility can resume talks with Eskom.
It makes sense for the miners to agree to a deal. Glencore’s Mutanda Mining Sarl and China’s Minmetals have installed diesel generators in their operations to ensure additional power-supply for copper production, which makes the process more expensive.
The Congolese Chamber of Mines says that this practice leads to increased costs of around $1,000 per ton of copper produced, according to News24.
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