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African Energy Resources edges closer to development of Botswana power project

African Energy Resources edges closer to development of Botswana power project

Cashed up African Energy Resources (ASX:AFR) has signed a term sheet with an as yet unnamed South African investment group to develop an integrated coal mine and thermal power station at its Mmamabula West power project in Botswana.

The group has a three month exclusive period to negotiate the terms of binding documentation for a joint development agreement for mine‐mouth power generation.

Mmamabula West provides an opportunity for near term power generation with its 2.47 billion tonnes of resources in two main coal seams.

Meanwhile First Quantum Minerals increased their interest in the Sese Integrated Power Project in Botswana to 53%, having spent A$1.3 million beyond the initial A$8 million investment on the Sese Project to date.

First Quantum can invest up to $20 million in the Sese JV.  African Energy's 25% share of additional funding will be loaned to it by First Quantum and carried to commercial production.

In December African Energy executed a binding share sale deal under which the company’s wholly owned subsidiary, Botswana Energy Solutions Ltd will sell the Mmamantswe Coal and Power project to TM Consulting for US$20 million, subject to certain conditions being met.

African Energy had cash reserves of $6.6 million in December 2015 and had been undertaking daily share buy- backs to tighten the share register and enhance capital gain prospects for the company.

African Energy is participating in the development of three large-scale power projects in Botswana, placing it in an enviable position to become a regional power force.



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Newswire
November 01 2012

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Project is for a gross 4mln tonnes per annum mine, feeding a 700Mw power plant.

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