11th Jan 2016 08:24
LONDON (Alliance News) - Kibo Mining PLC on Monday said it is finalising a memorandum of understanding with Tanzania Electric Supply Co Ltd on a power purchase agreement for the Mbeya coal-to-power project.
The Tanzania-focused mineral exploration and development company said "very constructive dialogue" has taken place with TANESCO and the Tanzanian Ministry of Energy and Minerals over the past 12 months, helping the parties to identify a set of principles to guide and direct the development of a power-purchase agreement for the project.
The memorandum of understanding with TANESCO will incorporate those principles, Kibo said, creating a reference framework to enable the two companies to jointly develop and implement the power purchase deal.
"Finalizing critical commercial arrangements on the Mbeya coal-to-power project, to ensure optimal value creation and realization on the company's flagship asset, is crucial at this stage of the project's development," Louis Coetzee, chief executive, said.
"This announcement also shows that the company is diligently and successfully attending to the Mbeya coal-to-power project's key commercial development objectives. These efforts are in turn strongly supported by the ongoing technical feasibility work that is rapidly advancing in parallel," Coetzee added.
The chief executive said Kibo is "continuing to progress" the final phases of its definitive feasibility study for the project.
"We have every reason to believe that we will be able to conclude the memorandum of understanding in the very near future and that we will complete all remaining feasibility work on time and in doing so also deliver the bankable feasibility study for the integrated Mbeya coal-to-power project on schedule," Coetzee said.
Shares in Kibo were down 2.2% at 5.01 pence on Monday morning, have starting trade higher.
By Samuel Agini; [email protected]; @samuelagini
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