African Energy Resources: 2.4Bt Mmamabula West acquisition approved
African Energy Resources (ASX: AFR)
has announced that the Minister for Minerals Energy and Water Resources
in Botswana has approved the transfer of title of the Mmamabula West
prospecting licence to African Energy Resources Ltd.
This satisfies the completion requirements of the Mmamabula West Sale Agreement.
Under
the terms of the Sale Agreement, African Energy will now make a US$1
million cash payment to Asenjo Energy. A final cash payment of US$1.5
million will be made to Asenjo Energy once a retention licence has been
granted over the project in mid-to late-2014.
Mmamabula West
contains 892 million tonnes of Indicated Resource and 1,541 million
tonnes of Inferred Resource at an average in‐situ raw CV of 4,800kcal/kg
(20.1 MJ/kg).
Through completion of the transaction, African
Energy has increased its total in-situ resources to over 6.2 billion
tonnes of thermal coal in Botswana.
An Environmental Impact Assessment for an underground coal mine at Mmamabula West has commenced.
A
feasibility study to assess the technical and economic viability of an
underground coal mine at Mmamabula West will commence in January 2014
and will be used to support the application for a retention licence by
31st March 2014.
AFR and ACWA Power International
Recently
African Energy entered into a potentially long term partnership with
ACWA Power International, for power generation in Botswana that could
also see the JV tender for additional projects in Africa.
ACWA
Power brings a pedigree and track record of completing multi-billion
dollar transactions in delivering power solutions in numerous countries,
and has paid-up capital of around US$1.4 billion. It is owned by eight
Saudi conglomerates.
The companies have executed a joint
development agreement for the development of a 300 MW power station and
integrated coal mine at African Energy's Sese coal deposit in Botswana.
This
project would be fuelled by coal from just a 50 million tonne block
within the Sese deposit's 2,500 million tonnes of resources - thereby
providing African Energy with enormous remaining resources to fuel other
power projects.
ACWA will be the lead developer of the 300MW
Botswana power project that the JV has tendered for; it will also bear
the majority on ongoing project development costs up to the point of
financial close.
African Energy will be the joint developer and
its local team will be responsible for delivering all permits required
for the project plus the mining solution – which are the core skills of
the company's team.
ACWA Power will have a first right of refusal to partner with African Energy on any new power opportunities using Sese Coal.
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