TIDMTLOU
RNS Number : 9372X
Tlou Energy Ltd
27 February 2017
27 February 2017
Tlou Energy Limited
("Tlou" or "the Company")
Tlou announces development partner for CBM to Power Project
Tlou Energy Limited, the AIM and ASX listed company focused on
delivering power in Botswana and southern Africa through the
development of coal bed methane ("CBM") is pleased to announce it
has signed a binding Heads of Agreement (Agreement) with
Independent Power Corporation PLC (IPC) to jointly develop Tlou's
proposed (up to) 100 MW CBM to power project (IPP Project).
Highlights:
Ø Tlou partners with Independent Power Corporation PLC (IPC) for
its proposed (up to) 100 MW CBM to power project;
Ø IPC is a power development company, specialising in high
efficiency, low emissions, gas fired power plants;
Ø As part of entering into the Agreement, IPC has received
letters of interest for in-principle funding support for the power
and infrastructure requirements of the IPP Project; and
Ø IPC will contribute to costs of the RFP under the
Agreement.
As announced on the ASX and AIM markets on 10 January 2017, Tlou
has received a request for proposal (RFP Tender) to tender for and
develop a CBM power plant of up to 100 MW at the Lesedi CBM
Project. The application process involved approval by Botswana's
Government Cabinet, following which it was reviewed by the Public
Procurement and Asset Disposal Board and then the receipt of the
request for proposal from the Ministry of Mineral Resources, Green
Technology and Energy Security (MMRGTES).
Under the Agreement with IPC, Tlou and IPC will jointly finalise
work on a detailed proposal for submission to MMRGTES for the
supply of CBM power in modular stages, including negotiations with
various third parties on the terms of an off-take agreement,
network access and project funding. The IPP Project will be
supplied with gas from Tlou's Lesedi CBM Project in Botswana.
Tlou Managing Director Mr Tony Gilby, said "Tlou is
strengthening its position as the leading gas to power company in
Botswana with the announcement of IPC as our preferred development
partner. IPC brings power generation experience and funding
partners to the project that significantly enhances its viability.
With an expanding gas reserves base, environmental approval for the
upstream component of the proposed development and now a power
development partner, we are in a very strong position.
We look forward to working with IPC to bring the
commercialisation of the Company's gas reserves to fruition for the
benefit of Botswana and our shareholders".
About IPC
IPC is a British power development company, specialising in high
efficiency, low emissions, gas fired power plants. Since its
formation in 1995 it has developed and operated over 4,500 MW of
generation capacity. IPC, through its subsidiary company
Independent Power Operations Limited, also provides a complete
operations and maintenance service for power generation and
distribution assets, acting as technical operator for power plants
worldwide. Of particular relevance to Tlou's proposed Botswana CBM
to power project, IPC has considerable experience operating in
Africa including the development of power projects in Angola, Ghana
and South Africa. IPC is owned by its Managing Director, Peter
Earl, and Swiss based projects group, TOMÉ International AG.
IPP Project Development Strategy
Tlou and IPC's strategy with respect to the RFP Tender
comprises:
-- An initial pilot power project of up to 10 MW of generation
capacity (using modular reciprocating engines);
-- Grid connection of the initial project; and
-- Expansion up to 100 MW of generation capacity and associated
infrastructure (using gas turbine units that can be installed in a
combination of open and combined cycle configuration, many of which
are currently operating successfully throughout Africa).
An important consideration for Tlou in entering into the
Agreement is that IPC has a relationship with General Electric (GE)
in the United Kingdom spanning over 20 years for procurement and
supply of GE power turbines and equipment. This UK based
procurement relationship has the added benefit that it will enable
the IPP Project to meet local UK content rules which are required
for project funding and support from UK and European credit export
agencies.
IPC Funding Support for the IPP Project
In connection with entering into this Agreement with Tlou, IPC
commenced discussions with a number of its project development and
funding partners and has received letters of interest from selected
parties for in-principle funding support for the IPP Project,
including:
-- Grant funding for the feasibility costs of the grid connection;
-- Debt funding of the initial 10 MW power engines;
-- Funding of the power lines to effect the required grid connection; and
-- Equity and debt funding for the power turbines for the larger (up to) 100 MW project.
Key Terms of the Agreement
The key terms of the Agreement are summarised below:
-- Tlou and IPC to jointly develop the IPP Project;
-- IPC to prepare a feasibility study for the IPP project to the satisfaction of both parties;
-- Tlou and IPC to jointly prepare the RFP Tender response to submit to MMRGTES;
-- IPC to arrange funding on behalf of the IPC and Tlou sufficient to support the RFP Tender;
-- IPC and Tlou to bear its own costs in fulfilling its obligations under the Agreement;
-- IPC commitment to fund half of external costs incurred to
prepare the RFP Tender, up to US$200,000; and
-- the Agreement provides for exclusivity up to 31 December
2017, unless terminated earlier by either party.
The Agreement is subject to both parties' board approval as to
the satisfaction of the results of feasibility studies, funding
support and the submission of the final RFP Tender.
For further information regarding this announcement please
contact:
Tlou Energy Limited +61 7 3012 9793
--------------------------------------- ---------------------
Tony Gilby, Managing Director
--------------------------------------- ---------------------
Solomon Rowland, Company Secretary
--------------------------------------- ---------------------
Grant Thornton (Nominated
Adviser) +44 (0)20 7383 5100
--------------------------------------- ---------------------
Samantha Harrison, Colin Aaronson,
Harrison Clarke
--------------------------------------- ---------------------
Optiva Securities Limited
(Broker) +44 (0)20 3137 1904
--------------------------------------- ---------------------
Jeremy King, Christian Dennis
--------------------------------------- ---------------------
St Brides Partners Limited +44 (0) 20 7236
(Public Relations) 1177
--------------------------------------- ---------------------
Elisabeth Cowell, Lottie Brocklehurst
--------------------------------------- ---------------------
FlowComms Limited (Investor +44 (0) 7891 677
Relations) 441
--------------------------------------- ---------------------
Sasha Sethi
--------------------------------------- ---------------------
Company Information
Tlou Energy is an AIM and ASX listed company focused on
delivering power in Botswana through the development of coal bed
methane ('CBM') projects. Botswana has a severe energy shortage and
is currently relying on expensive imported power and diesel
generation to deliver its requirements. However, as the 100% owners
of the most advanced gas project in the country, the Lesedi CBM
Project, Tlou Energy provides investors with access to a compelling
immediate and longer term opportunity using domestic gas to produce
power and displace the expensive diesel and import market.
The Company is led by an experienced Board, management and
advisory team including individuals with successful track records
in the Australian CBM industry.
Since establishment in 2009 the Company has significantly
de-risked the project in consideration of its goal to become a
significant gas to power producer. The Company has the most
advanced CBM project in Botswana and flared its first gas in 2014.
It holds 10 Prospecting Licences covering an area of 8,300Km(2) and
the Lesedi Project already benefits from significant, independently
certified Contingent Gas Resources of 3.2 trillion cubic feet (3C)
and independently certified Gas Reserves.
The Company is planning an initial scalable gas-to-power project
in Botswana. Following successful implementation of this first
scalable project, the Company plans to expand to provide further
power to Botswana and the southern African region.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCEAAAXAEPXEFF
(END) Dow Jones Newswires
February 27, 2017 07:12 ET (12:12 GMT)
Tlou Energy (LSE:TLOU)
Historical Stock Chart
From Mar 2024 to Apr 2024
Tlou Energy (LSE:TLOU)
Historical Stock Chart
From Apr 2023 to Apr 2024