Germany and Namibia will cooperate in the expansion of the Ruacana hydropower plant in Namibia, southern Africa.
With the agreement, the German Development Bank (KfW) will lend N$375m ($51m) to NamPower to co-finance the installation of a fourth turbine of 90MW at Ruacana.
Ruacana is the core of NamPower's production capacity and provides about 50% of Namibia's electricity supply, according to the Namibian.
With the new turbine, Ruacana's capacity will expand from 240MW to about 330MW.
The expansion of Ruacana started in November 2009 and will be completed by March 2012.
The total cost of the fourth turbine installation is expected to be N$750m ($102m).