UCG project in Tanzania makes progress

Linc Energy has entered into a Memorandum of Understanding (MOU) with the National Development Corporation (NDC) of Tanzania and Olympic Exploration Ltd. The MOU will see the groups work to develop a 400 MW underground coal gasification (UCG) to power operation in Tanzania.

The project will provide much-needed power to the Tanzanian electricity grid. The MOU provides a timeline for the commercial 400 MW power generation project, and sets a completion date in late 2017.

In a statement, Linc Energy said the power will support the growing demands on the Tanzanian Electricity Supply Co. Ltd (TANESCO) to meet the requirements of the economy.

The MOU specifies a programme of coal exploration and power plant development, which subject to project permitting and commercial term development, would see the commercialisation of a 400MW power plant in the South West of Tanzania in late 2017.

Under the MOU, the NDC has agreed to work with Linc Energy and Olympic Exploration to obtain all necessary permits and approvals for the project, while also assisting with the securing of land access, utilities and the development of a long-term Power Purchase Agreement (PPA).

Olympic Exploration Ltd has access to vast coal resources in Tanzania and will be working with Linc Energy on all of the necessary exploration, feasibility studies, finance raising, project engineering, delivery and operation on behalf of a future joint venture between the parties.

The details of the Joint Venture Arrangement will be negotiated over the coming months in accordance with the project delivery timeline outlined in the MOU.

The investment and operational experience gained from this first UCG project in Tanzania will cement the country as a regional leader in the adoption of clean coal technologies and power generation, Linc Energy claimed.

Peter Bond, CEO and managing director of Linc Energy said, “This MOU reconfirms the potential for underground coal gasification to play an increasingly important role in the energy mix of southern Africa. We are delighted to be partnering with the Tanzanian Government and Olympic Exploration in this exciting project which not only acts as a further catalyst for the commercialisation of UCG in Africa, but also affords significant economic and regional benefits to the people of Tanzania.”

Bond also said that the project would provide an opportunity for Linc Energy to showcase its ‘G5’ UCG technology.

Mlingi Elisha Mkucha, acting managing director, NDC, said, “The signing of this MOU with Linc Energy and Olympic Exploration presents an excellent opportunity for Tanzania to produce power from resources that would otherwise have not been tapped.”

“Linc Energy’s technology will allow power production in the remotest areas of Tanzania, which currently have limited grid connectivity, and thus enhance economic activities in these areas and contribute significantly towards the reduction of household poverty,” Mkucha added.

Peter Tsegas, Managing Director of Olympic Exploration Limited said, “Olympic Exploration is looking forward in working with Linc Energy and NDC to explore and develop new and alternative technology for power generation in Tanzania.”

Adapted from press release by Sam Dodson

Read the article online at: https://www.worldcoal.com/cbm/11082014/linc-energy-signs-mou-for-ucg-project-in-tanzania-cbm92/