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Nyamabuye Hydropower Investor Grilled at Electricity Disputes Tribunal :: Uganda Radionetwork
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Nyamabuye Hydropower Investor Grilled at Electricity Disputes Tribunal

Elemental Energy holds a license to construct a 7MW Nyamabuye Hydropower Project on River Kaku in Kisoro district, South Western Uganda.
The Director of Elementary Energy Limited (EEL) Shane Gloria Musanase was on Thursday grilled over the license dispute in the construction of a Nyamabuye hydropower project on River Kaku in Kisoro district. 

Elemental Energy holds a license to construct a 7MW Nyamabuye Hydropower Project on River Kaku in Kisoro district, South Western Uganda. The project is to cost USD 27 million. 

In July 2019, ERA issued a license revocation notice to the company saying it “was unlikely to fulfil its obligations under the license”. ERA gave the company 45-days to show cause why the license shouldn’t be revoked.  

In November, the Electricity Disputes Tribunal issued an injunction stopping ERA from cancelling the license of the Power Company. The tribunal ruled that the cancellation be stayed until complaint Elemental Energy filed against ERA at the tribunal has been disposed of. 

In 2018, the company missed a key date for financial closure – where financial arrangements are completed – but it asked for an extension to complete negotiations with financiers. But ERA refused to approve the company’s equity arrangement, claiming the partner Elemental was choosing had many uncompleted projects they were undertaking in Uganda.  

The company decided to petition the tribunal to compel the regulator to approve the partner to pave way for the financial close to happen.

On Thursday, the tribunal at its first hearing at Amber House in Kampala resolved that Musanase presents vital evidence of certified bank statement and proof of shareholders documents.  

Joseph Byamugisha representing ERA grilled Musanase around key issues of financial ability of Elementary Energy limited to complete the dam project, its shareholders and partners. 

ERA is also dissatisfied with EEL’s background in handling projects because, after its incorporation on 9th April 2010, it has not done any tangible work apart from planning and applying for a renewable energy project along with River Kaku.  

Asked whether EEL had the funds to complete the Kaku hydro dam power project, Musanase, said it was not available, prompting Byamugisha to query whether EEL was credible enough.  

However, Musanase told the tribunal that they had resolved to sell off their license and shares to an Equity Partner Frontier Energy, after an initial investment of 100 million shillings for the dam construction.

But Musanase said that they had not applied to transfer shares to Frontier Energy.  

The original shareholders of EEL are Elemental limited and Design Group and Associates, owned by Rowland Sekaziga, Esteri Akandwanaho respectively. They owned 85% and 15% shares respectively.  

Charles Okoth Owor, the tribunal chairperson adjourned the hearing to October 6th 2020.

Other members of the tribunal are Eng. Paul Mubiru, and Anaclet Turyakira.

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