Intra Energy Corporation has signed a Memorandum of Understanding (MoU) with Sinohydro Corporation of China for the joint development of the 270MW Ngaka coal-fired power station located in southwest Tanzania.
In a statement, the IEC Chairman, Graeme Robertson, said that the MoU represents the next stage in entering into a formal relationship to bring the project to fruition.
The purpose of the memorandum is to clarify mutual responsibilities between the parties in both the development of the project and in government negotiations.
Tancoal Energy Limited will be responsible for the development, mining and supply of coal to the Ngaka power station, while Sinohydro, the majority shareholder, will be responsible for the engineering, construction, operations and financing.
The coal mine has a Jorc coal resource of some 423 million tonnes and is currently mining and supplying more than 300 000 tonnes per year into the domestic industrial market.
The power station will be sited approximately 7 km from the actual mine site, and is expected to consume up to 1.2 million tonnes of high quality coal per year from Tancoal’s northern coal field.
The Ngaka power station is designed as a 2 x 135 MW pulverised coal injection plant and is expected to provide more than 15% of Tanzania’s current electricity generation.
The MoU, signed in Dar es Salaam, is valid for 12 months or until superseded by a Joint Venture Agreement and the establishment of the SPV Company.
