Tanzanian Government Declares Support for Rukwa

RNS Number : 6691Z

Kibo Mining Plc

11 March 2013

 

Kibo Mining 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: IE00B61XQX41

("Kibo" or "the Company")

11 March 2013

Tanzanian Government Declares Support for Rukwa Coal to Power Project: Commitment for Proactive Participation and Elevation of Power Project To Strategic Status In Tanzanian National Energy Strategy.

The board of Kibo Mining Plc (the "Company") is pleased to report that it has received a formal notification letter from the Tanzanian Ministry of Energy and Minerals ("MEM") dated 8 March 2013, in which, based on the MEM's initial assessment of the Project and the key role it could play as a regional power hub, notifies the Company that:

·    The Rukwa Coal to Power Project will, with immediate effect, be included as a strategic component of the Tanzanian Government's National Energy Strategy; and

·    The MEM undertakes to "participate proactively in procuring the establishment of this vital infrastructure node in the Mbeya region"; and

·    The MEM confirms its support for the expedited development of the Project to Kibo and its development partners.

The period of exclusivity enjoyed by the Asian conglomerate with which Mzuri Energy, a subsidiary of the Company, had previously entered into a non binding Memorandum of Understanding regarding the possible joint development of the project (RNS dated 15 May 2012) has since expired. The latest status of discussions with the Tanzanian Government now allows the Company to conclude the final selection process in respect of an appropriate development partner acceptable to the Company as well as the Tanzanian Government. A further announcement in this regard will be made as soon as possible.

Louis Coetzee, Chief Executive Officer of the Company commented: "Kibo is delighted by the strong support for the Rukwa Coal to Power Project expressed by the Tanzanian Government. The most significant milestone in Kibo's efforts since re-admission to AIM is undoubtedly the inclusion of its flagship project in the Government's National Energy Strategy. This, together with the Government's unequivocal commitment to participate proactively in the expedited development approach adopted by the Company, vindicates the unwavering support that the Company has enjoyed from its major shareholders and other long-term value investors, during a very difficult time. The Rukwa project is intended to be one of the cornerstones of a regional infrastructure development node on the Western gateway of the Mtwara Corridor. The Company's stated policy of aligning its projects at operational level with respected industry veterans with a proven understanding of their chosen fields of operation will also guide the final selection of a suitable development partner for the generation side of the power project. We are honoured to have this opportunity to continue to build value for our shareholders and the people of Tanzania." 

Louis Coetzee	[phone]	Kibo Mining plc	Chief Executive Officer
Andreas Lianos	[phone]	River Group	Corporate Adviser and Designated Adviser on JSE
Jon Belliss	[phone]	XCAP	Joint Broker
Matthew Johnson	[phone]	Northland Capital Partners Limited	Joint Broker
Stuart Laing	[phone]	RFC Ambrian Limited	Nominated Adviser on AIM
Matt Beale	[phone]	Fortbridge	Investor Relations

Updates on the Company's activities are regularly posted on its website www.kibomining.com

General Background & Strategy

Kibo was established in early 2008 to explore and develop mineral deposits in Tanzania, East Africa and was admitted to AIM in London on 27 April 2010 and AltX in Johannesburg on 30 May 2011.  The Board of Kibo is composed of professionals whose experience include mineral exploration, mine development, mining finance, tax, law, mergers and acquisitions, and financial control of public companies. It is supported by a competent and motivated Tanzanian staff that operates from Kibo's operations office in Dar es Salaam.

The mineral assets of the Company comprise five projects areas in Tanzania - Haneti (nickel, PGE and gold), Morogoro (Gold), Lake Victoria (Gold), Rukwa (Coal) and Pinewood (Coal & Uranium).

The Haneti project is the subject of a joint venture with Brazilian Votorantim Metais Participações Ltda, a member of Votorantim Group. The Rukwa and Pinewood projects are situated close to the Mtwara Corridor, an area where the Tanzanian Government has committed to significant infrastructure development and which has seen recent multi-million dollar investment in coal and coal-fired power stations and uranium exploration.

The Rukwa project is substantially more advanced than Kibo's existing exploration projects, with a significant Mineral Resource of thermal coal already defined.  This provides nearer term development and commercialisation potential, complementing the earlier stage existing projects held by Kibo.  This is further supported by strong support expressed by the Tanzanian Government for the expedited development of a coal mine and mine-mouth coal-fired power plant based on the Rukwa project. 

Kibo's objective is to build shareholder value in a sustainable manner.  This objective will be pursued primarily through active exploration of its own projects and by using the Company's experience in Tanzania to acquire attractive exploration and development assets on competitive terms that can be moved swiftly up the value curve by using the Company's own skills base whilst also seeking to benefit from strategic collaborative relationships with industry leaders who have special skills and competencies within their chosen fields of focus.  Kibo will undertake continual risk assessment of its projects and take whatever actions it believes are necessary to ensure that these risks are mitigated.

Johannesburg

11 March 2013

Corporate and Designated Adviser

River group

 

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