JOHANNESBURG – Kibo Mining said on Thursday that it was well placed to conclude negotiations on a power purchase agreement (PPA) with the Tanzanian government following the completion of restructuring and policy changes at the State-owned power supplier.
This comes after Tanzania president John Magufuli in January promptly sacked of Tanzanian Electric Supply Company (Tanesco) MD after the country’s Department of Energy and Minerals revoked an 8.5% increase in power charges that was to come into effect.
Kibo said its continued liaison with the Tanzanian government on the results of its integrated bankable feasibility study (IBFS) had confirmed that the company was well-positioned to bank on this agreement.
Kibo is on the brink of developing a 250 MW to 350 MW mouth-of-mine thermal power station, Mbeya coal-to-power project (MCPP), in its power and coal mine elements in south-western Tanzania.
The IBFS is a key document as it integrates the results of all studies to date on the project, which has enabled Kibo to negotiate successfully towards agreeing a power purchase agreement with the Tanzanian government.
The Tanzania-focused mineral exploration and development company has also established significant capacity and progress on all fronts in preparing for the financial close on the MCPP with the able and committed assistance of its advisors, partners and contractors.
Kibo chief executive, Louis Coetzee, said they were pleased with the first quarter progress at MCPP.
“We are very satisfied with our progress on meeting the strategic objectives for Q1 2017 Progress on finalising the MCPP PPA … it remains slower than we had hoped, but significant progress has been made in recent weeks and the indications are that this process will now continue to progress at pace,” Coetzee said.