COMOROS PURSUING GEOTHERMAL ENERGY

UNCLAS ANTANANARIVO 000114 SENSITIVE SIPDIS DEPT FOR AF/E AND AF/FO DEPT FOR OES ACTING A/S HARNISH DEPT DOR OES DAS MIOTKE AND DAS REIFSNYDER ADDIS FOR REO KBAUMAN E.O. 12958: N/A TAGS: ECON EINV EAID PGOV CN SUBJECT: COMOROS PURSUING GEOTHERMAL ENERGY ¶1. SUMMARY: The Union of the Comoros Government (GOC) is actively pursuing geothermal energy options to tap into volcanic Mount Karthala's heat on the main island of Grande Comore. Given the high cost and unreliability of the MAMWE electric utility, the geothermal alternative has the potential to address energy needs to allow economic development, as well as political stability and security. END SUMMARY. ¶2. Since the Embassy and Regional Environment Officer based at Embassy Addis brought U.S.-based Geothermal Development Associates (GDA) and the GOC together in 2008, they have begun negotiating a Memorandum of Understanding and explored financing options with the Kuwait Fund, German Government, International Finance Corporation (IFC),and private investors. Comoran Vice President Idi Nadhoim is the champion of the project, in weekly contact with Reno-based GDA and seeking funds for feasibility. VP Idi brought Kenyan geothermal experts from KenGen to Grande Comore for initial studies in 2008; he also attended the ArGeo Conference in Entebbe. ¶3. A GDA representative spent a week in Moroni in November, 2008, at VP Idi's invitation, to have technical talks with the MAMWE utility, meet KenGen to discuss their findings, and review existing data. A thorough feasibility study will cost between USD 500-900,000 to confirm Mount Karthala's geothermal potential. An IFC official recently came to begin work on privatization plans for both the state petroleum and telecommunications company; the GOC reportedly asked for assistance privatizing the MAMWE utility. Given its dated and dilapidated generators, inadequate billing and accounting, debts, and overall poor performance, the utility requires a complete restructuring in order to function. VP Idi told Comoros Officer he wants the GOC and IFC to pursue geothermal options in the context of privatizing and restructuring the power utility. ¶4. COMMENT: There is a critical shortage of economic opportunity in the Comoros. Tens of millions of dollars from the diaspora in France prevent acute hardship and humanitarian disaster. These remittances finance imported goods and a small group of traders. The public sector is by far the biggest formal employer with some 15,000 civil servants, though they are only sporadically paid. Commodity exports in ylang-ylang, vanilla, and cloves employee few Comorans and earn limited foreign exchange. High-potential tourism and fishing sectors remain undeveloped for lack or investment and reliable energy. Thousands of young Comorans flee the country every year seeking opportunity anywhere else in the world they can get to. Without cheap, reliable geothermal energy, the Comoros will likely remain impoverished, underdeveloped, and unstable. END COMMENT. MARQUARDT