Edenville Energy raises £2m to develop Tanzania coal project

Edenville Energy, which is developing a coal-to-power project in Tanzania, has raised £2m to advance its progress to full coal mining operations.

The funds raised will be used to buy a wash plant and crusher, buy other mining equipment for an initial planned production of up to 10,000 tonnes of coal per month, complete land compensation requirements, build supporting infrastructure, and to provide working capital as Edenville moves towards full production.

This will allow the coal mining operations at Rukwa to complete the transition from development to full production and generate cash flow from sales of processed coal, which will cover day-to-day costs at the mine.

The company raised £2m from an oversubscribed subscription of 250m shares of 0.02p each which were sold at 0.8p to new and existing shareholders, together with 125m warrants issued to the subscribers on the basis of one warrant for every two new shares, exercisable at 1.08p per warrant in the next 18 months.

The shares will be admitted to trade on AIM around 23 February and following admission the company will have an issued share capital of 847.06m shares with voting rights.

Chief executive Rufus Short said: "The subscription proceeds will establish a step change in the development of our activities in Tanzania, allowing the company to become a coal producer.

“We believe our Rukwa coal project has the potential to contribute significantly to the available coal supply in Tanzania and neighbouring countries."

Shares in Edenville Energy were down 5.49% to 0.860p at 1037 GMT.