The Export and Import bank of China (EXIM) and the Development Bank of Southern Africa (DBSA) will lend $430m to Zambian power utility Zesco to expand the capacity of its hydropower station.
EXIM and DBSA will fund the extension of the Kariba North Bank power station, situated about 130km south of Lusaka and due to be completed by 2012, according to Zambian energy Minster Kenneth Konga.
Zesco, a copper producer, will raise power generation capacity of its plant by 340MW to meet the expected rise in demand with new investments in mining and other sectors.
Konga told Reuters that the hydropower plant that produces 540MW will generate 720MW by October 2010, when the last of the existing four generators is upgraded.
The EXIM Bank of China would lend $315m and DBSA would provide the remaining $115m for the project being contracted by Sino-Hydro of China.
"The project involves putting up two new machines with a power generation capacity of 180MW each and we expect that work will be completed by November 2012," Konga said.