By Ulf Laessing
JUBA, Aug 30 (Reuters) - Norway will help South Sudan build a hydropower plant with work expected to start early next year, diplomats said, raising hopes of ending an era of dark nights at least in the capital.
Devastated by decades of civil war with Khartoum, South Sudan has no power grid. Electricity is only for the rich who can afford diesel generators at their villas in the capital, Juba, or business travellers in the city's expensive hotels.
The government has made more than $10 billion in oil revenues since a 2005 peace deal with Khartoum, but corruption and inexperience have hampered development since independence in 2011.
Juba also has no sewage system. Running water in residential buildings and offices comes unfiltered from the Nile, delivered by an army of trucks.
To kickstart development, Norway will partly fund and oversee construction of a 42-megawatt dam on the White Nile, providing enough electricity at least for Juba.
Tenders will be awarded in autumn with work to start in early 2014 and end in two years, Western diplomats said. The project will cost around $160 million, of which South Sudan is supposed to contribute a quarter.
With risk-averse Western firms largely shunning South Sudan due to its inefficient legal system, bidders for the plant will likely come from Asia, diplomats said. Chinese, Malaysian and Indian firms dominate the oil industry in South Sudan.
(Reporting by Ulf Laessing; Editing by Dale Hudson)