The Ethiopian Electric Power Corporation announced that the African Development Bank is going to finance the construction of Geba Dam and the construction of power transmission lines from Ethiopia to Kenya.

The corporation had requested the bank to directly supply 230 million dollars of the estimated 1.3 billion dollar cost of the transmission line, but the bank has not yet decided how much of the cost it is going to cover.

Ethiopia and Kenya had signed a memorandum of understanding for the construction of the transmission line in May 2006. The proposed bipolar, 1070 km long, 500KV line will originate from Welayta Sodo in the south of Ethiopia and terminate at Longonot, Kenya.

The bank is reviewing the corporation’s co-financing request, which was submitted in April for the 371 megawatt Geba Hydropower project on Baro-Akobo River. Although the corporation had initially expected the bank to directly finance 120 million dollar of the cost of the dam, subsequent discussions have raised the amount to 160 million dollars.

In a feasibility study conducted in 2005, the project cost of the dam was estimated to be around 535 million dollars. The corporation had requested the bank to directly finance more than half of the cost of the project.

An appraisal team will come to Ethiopia before the December meeting for final assessment and approval of the co financing.

The African Development Bank is expected to release the money to the Ethiopian Electric Power Corporation early next year.

Source: Fortune