PERTH: African Energy Resources Ltd announced the Sese Power (Pty) Limited has received the Generation Licence documentation for the Sese Power Project from the Botswana Energy Regulatory Authority (BERA).
The Generation Licence allows the Sese Power Project to export and sell 225MW of power for 15 years to Kalumbila Minerals Limited and Kansanshi Mining Plc in Zambia (both majority owned by First Quantum Minerals Limited), Zimasco (Pvt) Limited in Zimbabwe (owned by Sinosteel) and residual/surplus power to members of the Southern African Power Pool.
The licence may be renewed beyond 15 years or increased above 225MW by application to BERA as per the BERA Act, 2016.
Sese will be applying for an amendment to increase the licence to reflect the current planning for 300MW of generation. The Generation License was the final regulatory approval required for the Sese Project. The award of the Generation Licence follows the recent execution of power sales agreements for the first 300MW Stage of the Sese power station.
The Sese Power Project is one of the most advanced major Independent Power Projects in the Southern African region, and is receiving strong interest from major power consumers throughout the region. The Project remains actively engaged with parties seeking to participate in expansion stages beyond the first 300MW.
African Energy owns one third of the Sese JV, which is developing the 300MW Sese Power Station (Sese Project). Under a joint venture agreement signed in 2014, First Quantum Minerals Ltd (FQM) earned a 66.7% interest in the Sese Project, with African Energy owning the balance of 33.3% (Sese JV). The parties contribute pro rata to ongoing costs, however FQM are obliged to arrange all debt financing for the project and loan fund African Energy’s equity contribution.
The Sese JV has completed several technical studies covering mining, coal preparation and power generation. A conceptual study of the proposed power station layout and design has determined that Sese coal is a suitable fuel for all common power station boiler technologies and can readily meet the required air quality and emissions standards set in the environmental approvals for the project.
These studies have also established the operating costs, capital costs and a robust financial model for a power project and the associated coal mine and coal processing facilities and have demonstrated that power from Sese could be delivered to the large power consumers in the Zambian Copper belt.
Sese JV has executed power sales agreements with Kalumbila Minerals Limited (Zambian subsidiary of FQML) and a Term Sheet with Zimasco (Pvt) Ltd, which together would consume the full output of the initial 300MW power station for a period of 15 years.