Energy company unveils Malawi power-plant plan

26th April 2013

By: Marcel Chimwala

Creamer Media Correspondent

  

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ASX-listed miner Intra Energy Corporation has announced plans to develop a 120 MW coal-fired power plant in Malawi that will burn coal from its newly acquired Nkhachira mine in the north of the Southern African country.

Intra Energy chairperson Graeme Robertson says the energy group, which will implement the project through its subsidiary, Malcoal, decided to invest in the project because Malawi has a huge energy shortfall despite hosting some known coal reserves.

“The World Bank indicates that only 8% of Malawi’s population of about 16-million have access to electricity. The country’s current total demand for power stands at 300 MW, with only 160 MW of the installed generation capacity working effectively, resulting in a generation shortfall. This generation shortfall is projected to grow rapidly and the Malawi Ministry of Energy estimates that the country will need 603 MW by 2015 and 829 MW by 2020.

“Therefore, the development of the Malcoal Nkhachira mine and the proposed power station represents a significant improvement in Malawi’s electricity supply, as this is baseload supply, which is not subject to environmental factors such as drought as is the case with hydroelectricity, which Malawi currently depends on.”

Malawi derives 94% of its electricity from hydropower plants located on the Shire river, while 6% is generated from a thermal power plant at Wovwe, in the north of the country.

Robertson says, besides feeding the new power plant, the Nkhachira coal mine will also supply coal to industries, which currently imports coal, at competitive prices and simultaneously support indus- trial expansion.

He says: “The demand for coal in Malawi is significant. Currently, industries import coal from neighbouring countries. Malcoal has planned a two-stage development strategy of initially supplying coal to industries, which will remove the need for imported coal, and, secondly, supplying coal for electricity generation. The coal resource needs to be extensively examined and geologically mapped and drilled before becoming a certified power station fuel. When this has been completed, it will be a great benefit to the economy as Malawi-sourced coal to generate electricity will ensure national power independence as well as flow-on benefits in the community from the mining operations.”

Intra acquired the Nkhachira coal mine’s three exploration licences from local firm Consolidated Coal Mines and the deal gives Intra Energy a 90% controlling shareholding in Malcoal, while Consolidated Coal Mines retains 10%.

Robertson says Intra Energy is also working through another subsidiary, NuEnergy Gas, to develop opportunities to produce unconventional gas (coal-bed methane and shale gas) in southern Malawi, where NuEnergy Gas has an exploration licence.

“NuEnergy is carrying out extensive geo- logical studies on its licensed area and aeromagnetic/gravity surveys are about to commence to determine the depth and optimal drilling locations in the exploration area,” he says.

He adds that the company expects to install compressed natural gas and micro liquefied natural gas plants to enable coal-bed methane and shale gas to be effectively transported to distribution points for sale to industries and for use as fuel for passenger vehicles and truck fleets.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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