Name of the Project
Mbeya coal-to-power project (MCPP).

Location
Tanzania.

Client
Kibo Mining.

Project Description
The integrated bankable feasibility study (IBFS) on the MCPP has concluded that the MCPP is financially, technically and operationally a very robust project.

The IBFS comprises an integration of the definitive mining feasibility study (DMFS), the definitive power feasibility study (DPFS), the integrated financial model for the MCPP and all the other relevant technical studies on the MCPP to date.

The MCPP comprises a 122-million-tonne coal resource, of which 85.9% qualifies for inclusion in any future reserve statement. Of this, 39-million tonnes is included in the pit design and is sufficient to satisfy the required indicative coal requirement of 39-million tonnes for 30 years.

It has been proven that constant coal production over the total life-of-mine can be achieved.

The mining method developed for the Mbeya coal mine has been confirmed as modified terrace mining. Overburden will be removed using a free dig (truck-and-shovel) method, with coal seam and interburden mining using mechanised continuous surface mining. The DPFS has concluded that the power plant, which will be 250 MW to 350 MW, will require coal with a calorific value of 12.85 GJ/t.

Net power that will be generated has been estimated at 1 840 GWh/y.

Average coal and limestone consumption has been estimated at 1 497 432 t/y (as fired) and 110 359 t/y respectively.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The MCPP DMFS estimates an internal rate of return of 69.2% with a payback of 2.4 years.

Value
The MCPP DMFS estimates a peak funding requirement of $17-million.

No new figures have been released in the DPFS.

Kibo Mining remains restricted in its ability to release certain detailed information pertaining to the IBFS, owing to the company’s being engaged in highly confidential discussions with various parties, including regulatory authorities. Such information is commercially sensitive and could result in a breach of Kibo’s confidentiality obligations, subsequently harming the company’s chances to successfully complete negotiations.

The most recent figures, released in the April 2016 DPFS, confirmed the total estimated project cost of the thermal power plant as below the cost estimate stated in the power prefeasibility study (PFS) released in 2014. The power PFS estimated the project’s total cost, depending on the plant option selected, at between $640-million and $760-million.

Duration
Not stated.

Latest Developments
Kibo has been granted an environmental- and social-impact assessment (Esia) certificate for its MCPP.

The Esia takes the project a step closer to construction.

“The endorsement of the MCPP as a consequence of the Esia certification cannot be underestimated – this is probably the most important enabler for the successful and expeditious completion of the remaining development work on the MCPP,” Kibo CEO Louis Coetzee has said.

Kibo submitted the 1 000-page application to the Tanzanian government in February, outlining the technical, environmental and social assessment of the two components of the MCPP – a coal mine developed in tandem with a 300 MW mine-mouth power station.

The project, being developed in partnership with Chinese construction and engineering company Sepco III, had successfully completed a power prefeasibility study (PFS), a mining PFS, a definitive PFS, a definitive mining feasibility study, an independent integrated financial model and an integrated bankable feasibility study.

Coetzee has further commented that Kibo successfully engaged with the newly established Ministry of Energy in recent weeks.

“[The productive meetings] confirmed our view that the memorandum of understanding on the power purchase agreement (PPA) is progressing well and that it will be finalised shortly,” he has said.

Following the signing of the final PPA, Kibo expects MCPP to enter production within 36 months.

Key Contracts and Suppliers
Sepeco III (engineering, procurement and construction contractor) and GE (equipment, technology and services).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Kibo Mining, tel +353 91 865367, fax +353 91 755066 or email info@kibomining.com.