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Edenville in talks over power plant

By BFN News | 01:17 PM | Wednesday 26 March, 2014


Edenville Energy's Rukwa coal project in Tanzania has entered a new phase with the company seeking to match its coal deposit with the most viable power option. Edenville says it has been approached by a number of companies who have expressed an interest in developing a power plant in partnership with the company. And it confirms that preliminary discussions are under way with several parties. The company says the directors have decided to relinquish some of its non-core licences which were acquired for shares at the time of the company's admission to AIM following its acquisition of Edenville International in 2010. It has retained the remaining licences in line with its stated strategy of developing the company's Rukwa coal-to-power project and further evaluation of additional coal and uranium prospects. This allows managerial, financial and technical resources to be focussed on the achievement of that strategy. Relinquishment of these licenses will reduce the company's work commitments over the next 12 months by approximately US$1,000,000 and, in addition, represent a saving in annual licence holding fees of over $50,000. This decision will allow Edenville to continue its cash management programme and direct capital to the Rukwa coal projects which the board believes represents the best value for shareholders - althouth there will be a £1.7m impairment in the next figures. Chief executive Rufus Short said: "Edenville's project has entered a new phase where we are seeking to match our coal deposit with the most viable power option, ultimately contributing to the continued electrification of Tanzania. "As a consequence of the placing announced in January 2014, the Company has a stronger cash balance better positioning us to maintain the Rukwa coal assets whilst discussing partnership opportunities. "It is important to understand that this is not a standalone mining project which is linked to, or dependent on, commodity price cycles for its development and success. It is a potential fuel source for a country and region undergoing a significant, and long term, development of its power industry over a timescale of several years. "The deposit is strategically located in western Tanzania and whilst certain timelines for the project are inevitably linked to the country's power development programme, Edenville's intention is to move forward, technically and commercially, to advance the project along with the best possible partners in the energy space, maximising value for shareholders. "The Board's decision to relinquish some of the company's non-core licences will free up both capital and resources to concentrate on the Rukwa coal to power project. We consider this a rational approach in a market that is focused on assets that have a clear path to monetisation. "Over the coming months we will continue to update the market and shareholders on the progress of the project." At 1:17pm: (LON:EDL) Edenville Energy PLC share price was 0p at 0.07p Story provided by StockMarketWire.com

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