JOHANNESBURG (miningweekly.com) – Aim-listed diversified miner Bushveld Minerals on Thursday provided an operational update regarding its coal and energy subsidiary Lemur Holdings, stating that the bankable feasibility study for the integrated thermal coal mining and independent power project, in Madagascar, is progressing.
Bushveld reported that load, demand and transmission routing studies have been completed; discussions with the Madagascan government regarding the concession have been initiated; social- and environmental-impact assessments have started; and consultants have been appointed to support engagement with financial institutions for project financing.
Bushveld CEO Fortune Mojapelo said that notwithstanding the company’s focus on its flagship vanadium platform, it was committed to progressing the Lemur project as an integrated coal mining and power project – a configuration that Bushveld believes is key for the southwestern region of Madagascar.
The design and location of the Imaloto power plant would immediately increase the country’s baseload power supply by about 15%, with the option to scale up to supply more power to new electricity users in the region in the longer term.
Lemur Resources CEO Prince Nyati pointed to some of the company’s recent achievements, for example, the signing of a 30-year power purchase agreement with Madagascan State-owned power and water utility Jiro sy Rano Malagasy in November.
The agreement was a statutory precondition to receiving a concession for the power project from the government.
“The process to obtain the concession is under way and is a top priority for 2018, as well as the social- and environmental-impact studies, together with the bankable feasibility study and discussions with potential partners for project financing,” said Nyati.
The power plant will be located at the mine-mouth of Lemur’s coal deposit and is expected to be commissioned in 2021. According to a timeline provided by Bushveld on Thursday, financial close is targeted towards the end of 2019, with construction set to start in 2019 as well.
The addition of a power component will support Lemur's plans to unlock the value of the coal asset, while at the same time securing a reliable electricity offtake backed by a government entity. The coal deposit has a Joint Ore Reserves Committee-compliant resource of about 136-million tonnes of coal.
Lemur is co-developing the project and an associated 200 km transmission line with Chinese State-owned hydropower engineering and construction company Sinohydro, a subsidiary of PowerChina.