Posco Energy has been selected as preferred bidder for the construction of a new coal fired power plant in Botswana.

Posco formed a consortium with Marubeni to bid for the $800 million, 300 MW Morupule B Phase II project. Construction could start in the second half of 2016, with operations scheduled for May 2020, Posco said.

The power plant will be equipped with circulating fluidized bed (CFB) boiler technology and will use coal from the nearby Morupule coal mine. Some $600 million of finance for the project will be provided by Export-Import Bank of Korea, Japan Bank for International Cooperation (JBIC) and an international commercial bank.

Posco said the contract was the first time a Korean energy firm had "made headway" in southern Africa and that it intends to seek other opportunities for growth in the region.