Kibo Energy PLC - Proactive Investors Interview Q&A
(Registration Number: 451931)
(External registration number: 2011/007371/10)
Share code on the JSE Limited: KBO
Share code on the AIM: KIBO
("Kibo" or "the Company")
27 September 2019
Proactive Investors Interview Q&A
Could you explain the reorganization of the MCIPP, announced on
The Company has an 85% interest in a 303 million tonne ('Mt') coal resource in
Could you provide a bit more background to the deal?
Shumba recently acquired 80% of Coal Petroleum ('CP'), which is developing a petrochemical plant that will provide first
This plant will require a dedicated supply of 250-300MW electricity and to this end, Shumba and Kibo will incorporate a joint venture to oversee the design, development, construction, commissioning, and operation of a power station dedicated to powering it. Accordingly, a power purchase agreement will be put in place regarding 100% of the electricity required to power the plant over its life.
Why have you consolidated the coal resources?
We are consolidating our coal assets to create a 761Mt resource to take advantage of three significant revenue streams that are planned to come from the consolidated Mabesekwa coal resource. Shumba already has a binding Coal Supply Agreement to guarantee supply of all the feedstock that would be required for the life of the petrochemical plant, with binding offtake agreements to follow in due course for KP1 and KP2.
What three revenue streams are you talking about?
We can now fully leverage our coal resource at Mabesekwa by providing and fast-tracking three different revenue streams. These include:
· KP1, which is the new energy project that will provide energy to the petrochemical plant and which will require an estimated 1.5Mt of coal p/a;
· KP2, which is the 85% interest in the MCIPP, which will require an estimated 1.5Mt of coal p/a; and
· The petrochemical plant, which will require 4.5Mt p/a.
In summary, this would give Kibo access to a revenue stream from an estimated annual coal production of 7.5Mt coal p/a. compared to producing 1.5Mt p/a for its own consumption at the MCIPP power plant.
What is the net impact from a funding point of view?
There is no funding impact in addition to what Kibo currently has for the development of the MCIPP power plant. The only potential impact is that Kibo may have to nominally increase / expand its operational capacity to meet the additional operational / management demands for the development of x2 300MW power plants. As stated above, the funding for the feasibility / technical studies for KP1 will come from Shumba.
What is your relationship with Shumba?
The reorganisation demonstrates the fact that our relationship with Shumba is evolving into a closer and wider commercial relationship where we are leveraging of each other's strengths, as strategically envisaged when we first acquired the MCIPP in 2017. This is underscored by Shumba's willingness to agree to a further voluntary lock-in period in addition to the initial lock-in.
How does the deal create value for Kibo?
In multiple ways:
· 100% increase in the power project portfolio for
· Access to a revenue stream based on an estimated 7.5Mt annual coal production;
· Guaranteed PPA for first 300MW in 600MW portfolio;
· Significantly lower development and execution risk; and
· Real opportunity for shorter and faster route to revenue generation.
For further information please visit www.kibo.energy or contact:
Chief Executive Officer
Corporate and Designated Adviser on JSE
+27 (0) 83 4408365
+44 (0) 20 7374 2212
First Equity Ltd
NOMAD on AIM
+61 8 9480 2500
RFC Ambrian Limited
Investor & Media Relations Adviser
+44 (0)20 7236 1177
Kibo is simultaneously developing three similar coal-fuelled power projects: the Mbeya Coal to
Additionally, the Company has a 60% interest in
Corporate and Designated Adviser
This information is provided by RNS, the news service of the
Quick facts: Kibo Energy PLC
Market Cap: £6.73 m
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