HARARE - A Zimbabwean independent power producer on Thursday contracted China State Construction Engineering Corporation (CSCEC) to construct a 600-MW coal-fired power plant in the country's northwestern region to ease its chronicle power shortages.

Construction of the phrase one of the Lusulu power plant, to begin in early 2016, will cost $1.1 billion, according to the contract. CSCEC was awarded the engineering, procurement and construction (EPC) contract for what appears to be one of the largest power projects by value in Zimbabwe in recent years.

Chairman of Pan African Energy Resource Lusulu Power Stuart Perry told journalists at the signing ceremony witnessed by Finance Minister Patrick Chinamasa that the 600 MW is the first of four phases which will eventually add power generation capacity of Lusulu to 2000 MW.

He said the first phase, which will include construction of roads, transmission lines and related infrastructure, was scheduled for completion in the first half of 2019.

Finance Minister Patrick Chinamasa hailed the signing of the deal which he said will go a long way in addressing the infrastructure gap in power generation in the country.

He said the power project to be located in Binga in north west Zimbabwe will use surrounding coal concessions to fire the power plant and will feed its power onto the national grid with surplus being exported.

"The project is very important for the development of Binga as there will be huge infrastructure development in and around the plant," he said.

He also expressed hope that completion of the power project will not only boost availability of power in the country but result in a reduction in power tariffs.

Zimbabwe has faced perennial power shortages for over a decade owing to antiquated power plants. It currently produces 1,100 MW against demand of 2,200 MW and sometimes plugs the shortfall through imports from the region.

The country last year contracted a Chinese firm, Sino-Hydro to expand its second largest power plant, Kariba Power Station by 300 MW. The project is set for completion in 2017.