5th Nov 2018 10:10
LONDON (Alliance News) - Ncondezi Energy Ltd on Monday said it secured a letter of support for its integrated power and coal mine project in the Tete province in Mozambique.
The agreement confirms that development of the 300 megawatt power project will be managed through a Liaison Committee, chaired by the country's Ministry of Mineral Resources & Energy.
In addition, the power development company said it sealed its partnership with state power utility Electricity de Mozambique.
This contract sets out prerequisite conditions to enter formal tariff negotiations, Ncondezi Energy said. Electricity de Mozambique has identified certain preconditions to the negotiations including for the stability of local exchange rate outlook and for the continuation of the energy demand and regional tariff pricing outlook.
"Receipt of the support documents from the Ministry of Mineral Resources & Energy and Electricity de Mozambique are welcomed by the company, as they provide formal support for the continued development of the project as well as confirmation of the process and key development milestones required to enter into formal tariff negotiations and finalise the project development timetable," said Non-Executive Chairman Michael Haworth.
In addition, the company said it submitted final loan restructuring documents to loan holders for signature.
The loan restructuring is subject to the lenders agreeing to the documentation, as well as shareholders approving resolutions at the annual general meeting, which is expected to take place later on Monday.
If passed, this will give Ncondezi Energy the necessary headroom in its share authorities to undertake a contemplated debt-for-equity swap.
"The company believes that the shareholder loan restructuring process is in the final stages of being completed with negotiations with key lenders now complete and final documentation submitted for signature," added Haworth.
Ncondezi shares were trading 5.8% higher on Monday at 7.30 pence each.
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