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Mbeya coal to power project moving towards completion

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World Coal,

Feasibility work on Tanzania focussed mineral exploration and development company Kino Mining’s Mbeya coal to power project (MCPP) has now advanced to a level where Kibo can commence with the formal EPC-bid process for both the Mbeya power plant and the Mbeya coal mine.

On 31 May 2016, the company met with SEPCO III in Dar es Salaam to initiate the EPC bid process for the Mbeya power plant, in accordance with the provisions of the joint development agreement (JDA) in place between Kibo and SEPCO III. The meeting in Dar es Salaam marked the official start of the EPC-bid process and will be followed by a two day work session in Brussels in mid-June. During this second work session, Tractebel Engineering will brief and guide SEPCO III on the EPC bid process and procedure in accordance with the relevant JDA requirements. The first step in this process will require SEPCO III to agree and commit to an equity investment in the MCPP in order to obtain the right to be the sole EPC bidder for the Mbeya Power Plant EPC contract.

In the event that SEPCO III is named as the sole bidder for the EPC contract, SEPCO III’s bid will remain subject to various pre-conditions related to price, technical standards, operational standards etc., which must be met for the EPC contract to be awarded. The bid process will take place under the control and supervision of Tractebel Engineering as independent Qualified Person and in accordance with a pre-set, internationally benchmarked specification and standard. If the bid succeeds in meeting the Tractebel Engineering specification, it will also require that the bid terms are approved by the company and any debt providers to the MCPP.

The EPC bid process for the Mbeya coal mine is also well under way and the company is set to receive the first EPC budget quotations from eight bidders who have expressed an interest to bid for the mine EPC and mining contract.

Louis Coetzee, CEO of Kibo Mining, commented: "The MCPP is now speeding towards completion of the Integrated Bankable Feasibility Study for the MCPP and we are very pleased with progress, but more so with the results from the power definitive feasibility study, as well as the preliminary results from the mining definitive feasibility study.”

Edited from press release by Harleigh Hobbs

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