Aim-listed Caledonia Mining has appointed Voltalia to build a 12 MW solar power plant at the Blanket gold mine, in Zimbabwe.
This follows after the company last month secured the $13-million in required funds to invest in the construction of the project.
Voltalia is an international renewable energy provider and is listed on the regulated market of Euronext Paris. The company has considerable experience in the delivery of renewable energy projects, including the development, construction, operation and maintenance of solar power plants.
Voltalia is already active in Burundi, Malawi and South Africa.
Upon completion, the solar power plant is expected to provide about 27% of the mine’s total electricity demand.
This will significantly reduce the risk to the mine of any further deterioration in the quality of grid power, which would necessitate the increased use of diesel generators – which are substantially more expensive than grid power.
The plant will also reduce the mine's environmental footprint.
Caledonia and Voltalia have agreed an initial design phase for the project, after which, subject to the conclusion of an engineering, procurement and construction contract, procurement and construction are expected to begin.
The planned commissioning of the 12 MW solar plant is expected to be completed in the last quarter of 2021.
Caledonia raised the funds required to build the plant by way of an at the market sales process on the NYSE, conducted by Cantor Fitzgerald & Co on its behalf. Pursuant to the process, the company issued nearly 600 000 shares, representing considerably fewer issued shares than the expected 800 000 that it had initially applied to list.
The project is primarily intended to protect the Blanket mine from any further deterioration in the electricity supply situation.
While the project is being done for largely defensive reasons, it is also expected to yield a modest return to shareholders after taking account of the dilutive effect of the equity issued to fund it.