Integrated methane gas extraction facility and independent power plant
The KivuWatt Project involves the construction of an integrated methane gas extraction facility and independent power plant in two phases. The project will extract methane from Lake Kivu to generate electricity.
Construction works for the 25MW phase one of the methane gas-fired power plant began in August 2011 and the start-up and commissioning were initiated in June 2015. Construction on phase two, which will add an additional 75MW, is expected to start after six months after the full-commissioning of phase one.
The project is being implemented by KivuWatt, a subsidiary of ContourGlobal. The combined investment for the two phases is estimated to reach $325m, of which $142m has been earmarked for phase one.
The Sasol gas engine power plant (GEPP) is the largest natural gas-fired power plant in Africa and the first gas based power plant in South Africa.
Lake Kivu, one of the world’s deepest lakes, is estimated to hold 60 billion cubic metres of methane gas (CH4) and 300 billion cubic meters of CO2 at a water depth of 350m. The harmful gases are expected to saturate the lake in 50 to 200 years, which poses a gas eruption threat to more than two million people along its shores.
The offshore facilities are situated 12.5km from the city of Kibuye, while the power plant is located on a 5.5ha site in the outskirts of Kibuye.
Project activities for phase one primarily involved the construction and installation of a 750t floating barge integrating a gas extraction and treatment facility, a submerged, floating pipeline to transport the fuel gas ashore, an onshore gas receiving facility and power plant, and a temporary marine landing site (MLS) where the gas extraction facilities were assembled.
The extracted gas will be processed and pumped ashore for use by the power plant via a submerged floating pipeline. The power plant will produce electricity using three 20-cylinder Wärtsilä 34SG gas-powered engines that have a combined capacity of 25MW.
Phase two will involve the installation of nine additional gensets with a combined capacity of 75MW, additional barges, gas extraction and treatment facilities, and submerged pipelines.
The project will mitigate the dangers associated with the release of CH4 and CO2 from the lake, and provide an environment-friendly and sustainable source of power generation. It will decrease the country’s use of diesel to generate electricity, reduce the electricity cost, and enable the country to achieve its target of reaching 563MW of installed power capacity by 2017.
As of 2011, Rwanda has an electrification rate of just 9% and 68.4MW of installed capacity. The KivuWatt project will provide power to 30 village electricity systems. It is also expected to generate approximately 200 construction jobs and 60 permanent jobs.
The output from phase one will be sold to Ruanda’s Energy, Water and Sanitation Authority (EWSA), under a 25-year power purchase agreement.
In August 2011, a $91.5m loan for phase one was provided by Emerging Africa Infrastructure Fund (EAIF, $25m), FMO (the entrepreneurial development bank of the Netherlands, $31.5m), the African Development Bank ($25m) and the Belgian Development Bank ($10m).
The lenders were advised by Clifford Chance, whereas the project developer was advised by Norton Rose. BNY Mellon acted as the corporate trustee to the developer. The Multilateral Investment Guarantee Agency (MIGA) had earlier issued an investment guarantee for the project.
Fair Construction was subcontracted by Wärtsilä to carry out the power plant construction and was also subcontracted by the project developer to perform the civil works for the offshore facilities and the temporary MLS.
The detailed engineering design works for the offshore facilities were performed by Iv-Groep, while the construction and installation of the methane extraction facilities were performed by Civicon. Royal Haskoning performed the risks assessment for the project.
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