Aim- and JSE-listed Kibo Energy has decided to convert its application for a special mining licence (SML) for the Mbeya coal-to-power project (MCPP), in Tanzania, to seven mining licences.
It said on Tuesday that the decision had been taken in the interest of a "better economic outcome for all concerned stakeholders".
The SML application for MCPP had been recommended for approval in September 2018. This would also require Cabinet approval.
Following recent further discussions between Kibo and the Tanzania Mining Commission, the parties agreed that, on technical and procedural grounds, it would be more effective to convert the SML application to the application for seven mining licences.
Kibo assured its shareholders that there was no difference in the status of an SML versus a normal mining licence, with the difference mainly relating to changes in surface area, duration and level of approval.
Whereas an SML allowed for a surface area of up to 70 km2 and was effective for the life-of-mine of the operation, mining licences allowed for a surface area of up to 10 km2 and was effective for ten years, but could be renewed until the depletion of the deposit.
Further, while an SML required Cabinet approval, mining licences only required Ministerial approval.
"We are very encouraged by the latest developments in respect of our mining licence application, which is the product of constructive and cooperative interaction with the Mining Commission. The conversion of the SML application into seven mining licence applications demonstrates the willingness and commitment of the Mining Commission to cooperate with investors under the latest mining legislation and to find practical solutions in the interest of all stakeholders in order to stimulate the mining industry in Tanzania.
"The change in approach with regard to the mining licence application has also provided further clarity with regard to ongoing development of the MCPP in general and will afford the MCPP with a very welcome gain in forward momentum," Kibo CEO Louis Coetzee commented.