Kibo Energy has revealed that it has finalised and signed a new memorandum of understanding (MoU) with State-owned electric utility Electricidade de Mocambique (EDM), to guide and facilitate further development of Benga, as part of EDM’s mandate to develop electricity infrastructure and implement electricity projects in the country.
The Africa-focused energy company has also acquired 345 ha of land adjacent to its Benga power plant project, in Mozambique’s Tete province.
Alongside hosting a 150 MW to 300 MW thermal power plant, which is being developed as part of a joint venture agreement with local energy company Termoeléctrica de Benga, the expanded land holding provides room for the intended renewable and long-duration storage energy projects in line with Kibo’s commitment to creating reliable, sustainable and affordable electricity.
The terms of the new MoU with EDM remain the same as those of the MoU that preceded the latest version and focus on facilitating the project from its current development status to fruition.
The new MoU will be valid for an initial period of 12 months unless the parties agree to extend its validity or to terminate it early.
EDM aims to increase access to electricity and improve the quality of service to consumers by developing infrastructure for electricity generation, transmission and distribution.
The government of Mozambique considers the energy sector a strategic priority for the development of the country as part of its plan to accelerate social and economic development, and the government encourages investment in the energy sector, either public or private and by nationals or foreigners.
Kibo CEO Louis Coetzee says Kibo has been in regular discussion with EDM to determine ways in which the company can work together to commercialise the project and create affordable and reliable electricity supplies in Mozambique.
“This MoU marks a significant progression in these talks and is testament to the quality of our project proposal.”
He adds that Kibo, going forward, will look into ways to further de-risk and develop Benga and continue its engagement with EDM by progressing to the next development phase, having completed and submitted a positive definitive feasibility study and independent financial model on Benga to EDM.
“The extensive feasibility work and technical studies done to date are as a result of [Kibo] deciding to expand our land title; this enlarged landholding will enable us to establish the planned thermal power plant whilst also providing room to build renewable energy projects with long-duration storage, in pursuit of our strategy of focused and deliberate transition away from fossil fuel-based energy solutions.”