Kibo Energy makes solid progress with Benga project

Africa-focussed Kibo Energy updated the market on progress at the Benga Power Plant Project in Mozambique on Tuesday, reporting that the current non-binding term sheet for coal supply from Vale had been converted into a mutually-binding term sheet, to secure coal supply for the project.

The AIM-traded firm also said that Lesedi Nuclear Services had completed an optimised definitive feasibility study based on the current base case definitive feasibility study, successfully enhancing project economic viability and bankability.

It said the findings of the final draft optimised definitive feasibility study had been presented to the technical and commercial team of Electricidade de Moçambique (EDM) on 17 December.

“We are extremely pleased with the progress on the Benga project, as the technical work is now nearing completion and seamlessly integrates with the commercial and statutory developments,” said chief executive officer Louis Coetzee.

“The optimised definitive feasibility study and binding term sheet for a coal sale agreement are key cornerstones [and] prerequisites to take the EDM power purchase agreement negotiations progressively forward towards agreeing a final power purchase agreement.”

Coetzee said the “ongoing and increasingly negative” impact of Covid-19 had caused numerous delays over the last year, most notably regarding the inability to travel freely and conduct on-site work.

“Despite these constraints, the project made significant strides forward during 2020 and we have been able to sustain forward momentum and in fact gain significant new momentum towards the end of 2020.

“It is with this momentum that we will be entering 2021 and with firm confidence that the Benga Power Plant Project can still be delivered within the broad timelines discussed in previous announcements.”

At 0835 GMT, shares in Kibo Energy were up 10.56% at 0.2p.