Closing on Acquisition of Bordersley Power Site

RNS Number : 0738D

Kibo Energy PLC

21 June 2019

 

Kibo Energy PLC (Incorporated in Ireland)

(Registration Number: 451931)

(External registration number: 011/007371/10)

Share code on the JSE Limited: KBO

Share code on the AIM: KIBO

ISIN: IE00B97C0C31

("Kibo" or "the Company")

 

Dated: 20 June 2019

Kibo Energy PLC ('Kibo' or the 'Company')

MAST Energy Developments Limited: Successful Closing on Acquisition of Bordersley Flexible Power Site

Further to its RNS dated 21 May 2019, Kibo Energy PLC, the multi-asset, Africa focused, energy company, is pleased to announce an update on its 60% owned subsidiary, MAST Energy Developments Limited ('MED'), a private UK registered company targeting the development and operation of flexible power plants to service the UK reserve power generation market.

Highlights

·    MED has completed acquisition of Bordersley Power Limited ('Bordersley'), a Special Purpose Vehicle ('SPV') which will comprise a 5MW gas-fuelled power generation plant targeting commercial commissioning end Q1 2020

·    Consideration of GBP175,000 in cash and reimbursement to the SPV vendor GBP2,000 in costs related to the Gas Connection Offer

·    Louis Coetzee and Pieter Krügel to be appointed as directors of Bordersley (existing directors and officers of Bordersley to resign)

·    Multinational Clarke Energy selected as preferred EPC contractor

·    Encora Energy Limited selected as preferred owners engineer

·    Negotiations underway with Statkraft Markets GmbH for a power purchase agreement

Louis Coetzee, CEO of Kibo Energy, commented, "As we progress Kibo along its journey into the Energy market, we discover many opportunities aligned with our strategy.  As early as November 2016, the Carbon Trust, in collaboration with the Imperial College published in their report, "An Analysis of Electricity System Flexibility for Great Britain": "The UK electricity system is undergoing significant changes to provide electricity that is secure, affordable and low carbon. To achieve decarbonisation, the electricity system will integrate increasing amounts of variable renewable and inflexible nuclear generation, whilst enabling the electrification of the heat and transport sectors. These changes will increase the need for system flexibility. At the same time traditional sources of flexibility, such as

conventional coal and gas generation, will reduce in capacity. Therefore, new sources of flexibility will be needed to adequately meet demand and ensure system stability".

This initial strategic acquisition made by MED is a key milestone as it advances its strategy to become a key player in the UK flexible power generation market.  Preparations, including the appointment of an EPC contractor and owners engineer, as well as commercial discussions, are well underway ahead of MED's target of first operations in late Q1 2020."

Sale and Purchase Agreement

As part of its strategy to develop and operate flexible power plants to service the Reserve Power generation market, MED has completed on a Sale and Purchase Agreement ('SPA') to acquire Bordersley, an SPV, from Balance Power Projects Limited ('Balance') as referred to in the RNS of 21 May 2019. 

Bordersley will comprise a 5MW gas-fuelled power generation plant supported by a Grid Connection Offer and a Gas Connection Offer, which, subject to successful financial close, notice to proceed, and no external connectivity delays, is being targeted for commercial commissioning end Q1 2020. 

As part of the Bordersley development, Clarke Energy, a multinational specialist in distributed power generation solutions, has been selected as the preferred Engineering, Procurement and Construction ("EPC") contractor; a proposal is being evaluated and contract negotiations underway.  Additionally, contract negotiations underway with both Encora Energy Limited, which has been selected as the preferred owners engineer, and Statkraft Markets GmbH for a power purchase agreement ('PPA'), regarding the implementation and execution of the MED desired trading and optimisation strategy. 

**ENDS**

This announcement contains inside information as stipulated under the Market Abuse Regulations (EU) no. 596/2014.

For further information please visit www.kibo.energy or contact:

Louis Coetzee	[e-mail]	Kibo Energy PLC	Chief Executive Officer
Andreas Lianos	[phone]	River Group	Corporate and Designated Adviser on JSE
Ben Tadd / Tom Curran	[phone]	SVS Securities Limited	Joint Broker
Jason Robertson	[phone]	First Equity Limited	Joint Broker
Andrew Thomson	[phone]	RFC Ambrian Limited	NOMAD on AIM
Isabel de Salis / Gaby Jenner	[phone]	St Brides Partners Ltd	Investor and Media Relations Adviser

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

20 June 2019

Corporate and Designated Adviser

River Group

 

END

 

 

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