AFRICAN ENERGY RESOURCES INTERESTED IN BUILDING BOTSWANA COAL POWER STATION [FYI – Source: African Energy Resources Company Press Release, additional reporting @ proactiveinvestors.au; NOT a Government Statement] African Energy Resources (ASX: AFR) plans to submit an Expression of Interest (EOI) in response to the Botswana Ministry of Minerals, Energy and Water Resources’ tender for development of a greenfield 300 megawatt coal fired power station. Botswana has been heavily dependent on importing electricity from the neighbouring countries, primarily from South Africa. However, the upcoming commissioning of the Morupule B plant as well as the proposed 300MW brownfield IPP expansion at Morupule and greenfield plant could turn the country into a net exporter, allowing it to leverage its extensive coal resources. The EOI seeks information on how a preferred Independent Power Producer (IPP) could develop the plant at a new, additional, site in the country. It will also seek to discover how those projects could deliver power into the grid as early as 2016, and no later than 2019. The deadline for submissions is 27th of November 2013 and while the Ministry expects to determine its IPP procurement process from January 2014, it has indicated that the information provided may allow it to identify projects that could be engaged earlier. The company claims that the release of the EOI provides a definitive timeline for completion of project joint venture negotiations and preparation of project development, financing and construction arrangements. Sese Coal Project The tender appears to be a strong fit with African Energy Resources proposed 300MW project to be located at its Sese coal project, with coal supply from Block‐C. Sese is a low-cost thermal coal project capable of producing large volumes of export coal and power station fuel. Measured resources defined at Sese Block‐C alone contain enough coal to support an estimated 2,400MW of generating capacity for over 25 years, thereby providing substantial expansion opportunities. Studies indicate that the geometry and low strip‐ratio of the Sese Block‐C coal resource will result in mining costs towards the bottom of the southern African cost curve, allowing the development of power projects with very competitive tariffs for sale to regional utilities and private companies. The company has also completed the acquisition of the 1.3 billion tonnes Mmamanstwe coal project in Botswana from Aviva Corporation (ASX: AVA), bringing its total coal resource in Botswana up to 3.8 billion tonnes.
Posted on: Thu, 08 Aug 2013 15:23:33 +0000