Kibo Mining PLC has signed a memorandum of understanding for the power purchase agreement at its Mbeya coal to power project in Tanzania, the company said.
The memorandum was signed with the state-owned Tanzania Electric Supply Co (Tanesco) and is a precursor to the finalisation of the agreement with the Tanzania’s Ministry of Energy.
Kibo said the agreement would enable it to move the Mbeya project into the final development phase, which would involve construction and commissioning.
In addition, the company hopes to secure funding for the Mbeya project during the second half of 2018. Kibo is confident that the project will produce electricity within 36 months.
According to Alliance News, Kibo is planning to build a 300 megawatt mine-mouth power station in south-western Tanzania, which it said will help alleviate the country’s energy deficiency.
Chief Executive, Louis Coetzee, said: “This is a seminal moment for Kibo as a signed MOU signals the official engagement by Tanesco and the ministry in the formal implementation of the Mbeya coal-to-power project and moves us to just one step away from finalizing the power purchase agreement.
“This welcome news follows a month of hard work by Kibo, who have made sure that all relevant stakeholders, especially our development partners, will be ready and in place to immediately commence with this final critical phase of the power purchase agreement process.
We will continue to work closely with all the relevant parties and remain positive that the Ministry will honour its commitment to deliver a signed power purchase agreement by the end of the first quarter,” Coetzee said.
