Lemur Holdings, the coal and energy subsidiary of Bushveld Minerals Limited (LON:BMN), has executed a binding 30-year concession agreement with the Madagascan government.
Lemur, which is developing the Iamaloto integrated thermal coal mining and independent power project in Madagascar, said the concession is for an initial 60 megawatt (MW) capacity.
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As well as a number of approvals on the capacity, evacuation lines and land uses, the concession also contains provisions for lenders' standard terms and conditions to ensure the bankability of the project.
Bushveld said the project remains on track to deliver electricity to Madagascar by 2021.
"The signing of the concession with the government paves the way for Lemur to move towards construction of the project, subject to concluding the SEIA [social environmental impact assessment] and achieving financial close. Once completed, this project will, for the first time in the history of Madagascar, interconnect the south region from west to east, including the towns in-between," said Prince Nyati, the chief executive officer of Lemur Holdings.
Lemur Secures Power Purchase Agreement with National Utility JIRAMA for the Imaloto Power Project pic.twitter.com/oPIpHBIiwj
— Bushveld Minerals (@BushveldMin_Ltd) November 23, 2017
Fortune Mojapelo, the chief executive of Bushveld Minerals, noted that 2018 is an election year in Madagascar and said the company would be monitoring the political developments closely.
"Notwithstanding Bushveld Minerals' focus on its flagship vanadium platform, the company is committed to deliver[ing] on the value of the Imaloto Project by completing the milestones that were set out for this year. These include: progressing the bankable feasibility study; completing the SEIA; as well as engaging with lenders,” Mojapelo said.