President Jakaya Kikwete’s administration is facing a possible multi-billion lawsuit if it continues to default its contractual obligations in the Mwanza 65MW thermal power generation project.
The possibility comes after the national power utility company (Tanesco) was given a stern warning by M/S Semco Maritime and Rolls-Royce (the contractors) for its continued default of contractual terms of issuing advance payments.
A ‘tough’ letter dated 9th December, 2011 seen by this newspapers addressed by the contractors to Tanesco Managing Director, copied to several government officials including the Ministry of Energy and Minerals, Bank of Tanzania and Ministry of Finance, indicated that despite President
Kikwete’s intervention in the power woes “we are yet to receive the agreed amounts.” The letter categorically revealed contractor’s feelings of taking the matter to relevant legal channels which may embarrass the government like in the current Dowans saga.
Tanesco Communications Manager, Badra Masoud, said they are aware of the complaints but they had initially paid Euro 8 million and another Euro 7 million will be paid soon. She added that the contractors’ were informed even after meeting Kikwete that they had initially failed to present their guarantee letter in time.