TIDMKIBO
RNS Number : 9025V
Kibo Energy PLC
06 December 2019
Kibo Energy PLC (Incorporated in Ireland)
(Registration Number: 451931)
(External registration number: 2011/007371/10)
Share code on the JSE Limited: KBO
Share code on the AIM: KIBO
ISIN: IE00B97C0C31
("Kibo" or "the Company")
Dated: 6 December 2019
Kibo Energy PLC ('Kibo' or the 'Company')
Update re Reorganisation of Botswana Interests
Kibo Energy PLC, the multi-asset, Africa focused, energy
company, is pleased to announce an update regarding its agreement
with Shumba Energy Ltd ('Shumba') that significantly repositions
its interests in Botswana, namely the Mabesekwa Coal Independent
Power Project ("MCIPP") and associated coal asset (see announcement
dated 25 September 2019).
Overview
-- Signed first of a series of agreements to implement the Heads
of Agreement ('HoA') with Shumba to reorganise the arrangements for
the MCIPP and its associated coal asset in Botswana
-- Shareholder Agreement signed in respect of restructuring Kibo
Energy Botswana (Pty) Ltd ('KEB'), providing Kibo with a 35%
interest in KEB, which holds a total 761Mt coal resource and has
three large customers
-- Signed Shareholder Agreement concludes restructuring of first
Botswana subsidiary company, Kibo Energy LTD (Botswana)
-- Remaining agreements on track to be completed by 20 March 2020 in which Kibo will also hold:
o 85% interest in an energy project, which is to be called
KP2
o 35-40% interest in a new 300MW energy project, KP1, that will
exclusively provide a new petrochemical plant with energy
-- Agreement gives Kibo access to a revenue stream from an
estimated annual coal production of 7.5Mt coal p/a
Louis Coetzee, CEO of Kibo, commented, "We are delighted with
the progress being made as we advance the restructuring of our
interests in Botswana to significantly lower development and
execution risk. Being part of several much larger projects
naturally provides many benefits and advantages to the Company and
its shareholders. Not least because, having finalised the
shareholder agreement today, we'll be holding a 35% interest in an
enlarged project with a total 761Mt coal resource that already has
three large customers, whereas before we had one. We also continue
to hold an 85% interest in the energy project, which is to be
called KP2 and in addition, a 35-40% interest in a new 300MW energy
project, KP1, a bespoke 300MW power plant that will exclusively
provide a new petrochemical plant with energy, where the costs of
feasibility / technical studies are to be funded by Shumba.
"We can now fully leverage our coal resource at Mabesekwa by
providing and fast-tracking three different revenue streams, which
would give Kibo access to a revenue stream from an estimated annual
coal production of 7.5Mt coal p/a. compared to producing 1.5Mt p/a
for its own consumption at the MCIPP power plant. As I mentioned in
past announcements, there is no funding impact in addition to what
Kibo currently has for the development of the MCIPP power plant
other than we may have to nominally increase our operational
capacity to meet the additional operational / management demands
for the development of two 300MW power plants. This is a real
opportunity for a shorter and faster route to revenue generation;
we look forward to updating shareholders on further progress
soon."
Background & Details
In September 2019, Kibo and Shumba signed a binding Heads of
Agreement ('HoA') with Shumba and various subsidiaries of each
party ('the Parties') to reorganise the arrangements for the MCIPP
and its associated coal asset in Botswana.
The reorganisation sees the MCIPP Retained Assets consolidated
into Kibo Energy Botswana (Pty) Ltd ('KEB'); this enlarged project
in which Kibo has a 35% interest has a total 761Mt coal resource.
An additional Joint Venture ('KP2') between Kibo and Shumba (held
85%/15% respectively) will advance the existing MCIPP energy
projects in Botswana. Additionally, Kibo and Shumba will jointly
manage and oversee the development of a bespoke 300MW power station
(the 'KP1 Power Plant') through the incorporation of a new company
to be held 35%-40% by Kibo and the balance by Shumba. Shumba will
provide the full development funding requirement for associated
feasibility and technical studies.
Notably, the KP1 Power Plant is envisaged to provide 300 MW
power to a Petrochemical Plant ('PCP'), which will provide Botswana
first and then Africa with energy fuels and specialty chemicals.
The PCP is being developed by Coal Petroleum ('CP'), which is 80%
owned by Shumba with other partners including leading Chinese EPC
companies PowerChina International Group Limited and Wison Group.
CP is engaged in advanced discussions with several regional
purchasers of fuels and other petrochemicals in Botswana, South
Africa, Namibia and Zambia.
The consolidated MCIPP Resource will supply the PCP, the KP1
Power Plant and the MCIPP power plant with coal.
Accordingly, a series of agreements are being advanced between
the Parties to implement the HoA. The first key agreement is the
Shareholder Agreement in respect of restructuring KEB, which has
now been finalised; this concludes the restructuring of the first
Botswana subsidiary company, Kibo Energy LTD (Botswana). The
remaining agreements are on track to be completed by 20 March
2020.
**ENDS**
For further information please visit www.kibo.energy or
contact:
Louis Coetzee info@kibo.energy Kibo Energy PLC Chief Executive Officer
Andreas Lianos +27 (0) 83 4408365 River Group Corporate and Designated
Adviser on JSE
------------------- --------------------- -------------------------
Jason Robertson +44 (0) 20 7374 First Equity Limited Joint Broker
2212
------------------- --------------------- -------------------------
Bhavesh Patel +44 20 3440 6800 RFC Ambrian Limited NOMAD on AIM
/ Stephen Allen
------------------- --------------------- -------------------------
Isabel de Salis +44 (0) 20 7236 St Brides Partners Investor and Media
/ 1177 Ltd Relations Adviser
Beth Melluish
------------------- --------------------- -------------------------
Notes
Kibo Energy PLC is a multi-asset, Africa focused, energy company
positioned to address the acute power deficit, which is one of the
primary impediments to economic development in Sub-Saharan Africa.
To this end, it is the Company's objective to become a leading
independent power producer in the region.
Kibo is simultaneously developing three similar coal-fuelled
power projects: the Mbeya Coal to Power Project ('MCPP') in
Tanzania; the Mabesekwa Coal Independent Power Project ('MCIPP') in
Botswana; and the Benga Independent Power Project ('BIPP') in
Mozambique. By developing these projects in parallel, the Company
intends to leverage considerable economies of scale and timing in
respect of strategic partnerships, procurement, equipment, human
capital, execution capability / capacity and project finance.
Additionally, the Company has a 60% interest in MAST Energy
Developments Limited ('MED'), a private UK registered company
targeting the development and operation of flexible power plants to
service the Reserve Power generation market.
Johannesburg
6 December 2019
Corporate and Designated Adviser
River Group
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END
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