Rukwa coal-to-power project, Tanzania

24th July 2015

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

  

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Name and Location
Rukwa coal-to-power project, Tanzania.

Client
Edenville Energy.

Project Description
A scoping study completed on the Rukwa coal project has indicated an economically sound project with a relatively low capital expenditure (capex) cost and a 50-year life-of-mine. A small-scale mine and power plant (coal-to-power) scenario to provide electricity for local markets has been identified as having the best balance for shareholder return, deliverability and achievable capital requirements.

The Rukwa coal-to-power project hosts 171-million tons of measured and indicated coal, sufficient to support a 120 MW power station over the life of the project.

Net Present Value/Internal Rate of Return
Not stated.

Value
The capex to deliver a combined mine and power plant is estimated at between $35-million and $50-million.

Duration
Not stated.

Latest Developments
Marking a key step in the advancement of the flagship project to development stage, Edenville has confirmed that the Tanzanian Ministry of Energy and Minerals (MEM) and power generation, transmission and distribution body Tanesco have started the review process of the Rukwa power plant’s feasibility study.

The feasibility review process will result in the State reviewing and assessing proposed power generation projects that satisfy commercial and regulatory requirements.

Edenville has said that it is “most encouraged” that the power plant feasibility has been positively received and is in the review stage with the MEM and Tanesco.

“This will enable the company to advance negotiations relating to power purchase agreement tariffs and plan the integration of Edenville's power plant into Tanzania's transmission and distribution infrastructure programme,” the company states.

The agreement of base tariff rates is expected to better define capital and operating expenditure requirements, allowing accurate modelling by engineering, procurement and construction (EPC) groups as part of the formal tender process.

Edenville CEO Rufus Short expects the project to make significant progress now in three key areas: the MEM and Tanesco review of the power plant feasibility study, the submission of the mining licence application and discussions with EPC partners.

“We're moving forward on these fronts in parallel, each allowing better definition of the project's economic and technical parameters, taking us closer to the point of a formal relationship with an EPC partner.

“I am very encouraged by the recent discussions we had with the MEM, which underlined the absolute necessity of coal-fired power generation in Tanzania and I am confident we will continue to receive valuable input and support from the Tanzanian authorities,” he says.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Edenville Energy, tel +44 20 7653 9850 or email info@edenville-energy.com.

Edited by Creamer Media Reporter

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