Kibo Mining PLC (LON:KIBO) has signed a Memorandum of Understanding with the Tanzania Electric Supply Company, known as TANESCO, with regards to a Power Purchase Agreement for power that will be produced from Kibo’s 300MW Mbeya coal-to-power project.
The MOU constitutes the precursor to the finalisation of the PPA with TANESCO.
This could happen as early as the end of the current financial quarter, in accordance with the timeline previously agreed with TANESCO and the Ministry of Energy.
The MOU sets out clear guidelines, deliverables and timelines for the conclusion of the PPA. The PPA will enable Kibo to move towards execution and conclusion of the final development phase of Mbeya, construction and commissioning.
Kibo hopes to complete funding arrangements for the construction and commissioning of Mbeya during the second half of this year.
The company believes it can deliver first electricity into the grid 36 months after construction begins.
"This is a seminal moment for Kibo as a signed MOU signals the official engagement by TANESCO and the Ministry in the formal implementation of the MCPP and moves us to just one step away from finalizing the PPA,” said Kibo chief executive Louis Coetzee.
“We will continue to work closely with all the relevant parties and remain positive that the Ministry will honour its commitment to deliver a signed PPA by the end of Q1."