Uganda Raises Cost Estimate for Karuma Hydroelectric Dam

Uganda has raised its cost estimation for the 650MW Karuma hydroelectric dam project to $2.2bn.

The dam, which is to be built on the Nile River, was initially projected to cost $1.3bn, but estimates have risen following a feasibility study.

The Ugandan Government will seek funds from the African Development Bank to finance the project and will also consider floating a government bond, reports Bloomberg.

The dam is scheduled to start electricity production within the next five years.

The project will be jointly developed by Sithe Global and Industrial Promotion Services Kenya, an affiliate of the Aga Khan Fund for Economic Development.

Uganda is in the process of carrying out its first hydroelectric dam project, the 250MW Bujagali dam, at a cost of $800m. The dam is expected to reach full generation in April 2012.