African Energy in Good Standing
Posted on : Saturday , 24th October 2015
Gaborone — The dual listed African Energy says it is in good financial standing following steps the company undertook to reduce expenditure such as structured divestments and staffing levels, executive salaries and corporate overheads.
African Energy is listed in the Botswana Stock Exchange (BSE: AFR) and Australian Securities Exchange (ASX: AFR). The company states in its annual report released recently that it has acquired a strong partner at Sese and a high quality asset at Mmamabula West.
It is said First Quantum Minerals invested P59 million for an initial 51 per cent project level interested in Sese. The company has also committed to invest a further AUD12 million (P90 million) in the project within 18 months to increase its stake to 75 per cent.
African Energy says the funds would be used to evaluate the development of a fully integrated mine-mouth power station at Sese. Following these developments, African Energy says it will not be required to provide further funding into the development of Sese project.
A study of power station technology to finalise boiler selection, unit sizing and layout is nearing completion. As for Mmamantswe, African Energy states that it has reached a binding agreement with South African company, TM Consultants to sell them Mmamantswe project for P207 million.
This however will happen if TM Consultants successfully wins the tender and the project reaches financial close. South Africa has announced a 1600MW coal fired base load Independent Power Producers which will include up to 600 MW from cross border projects such as Mmamantswe.
African Energy states that TM Consulting will be responsible for sole funding all work required to prepare and submit a bid into the IPP procurement programme, thereby it is relieved from providing any financial commitments into the project.
Situated in Kgatleng district, several kilometres from the South African-Botswana border, Mmamantswe project was first owned by Australian firm Aviva Corporation who later sold it to African Energy after they could not secure an IPP agreement with South Africa.
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