Mabesekwa coal project shunned in new strategy
Botswana’s coal industry could be suffering another blow to its anticipated growth expected to utilise the country’s over 200 billion resource. The development comes after Kibo Energy recently announced intentions to refocus, dispose of coal energy projects to focus on renewable energy opportunities.
The company says its new blueprint is in line with the company’s refocused strategy centred on sustainable renewable energy solutions.
Kibo Energy has been pursuing the Mabesekwa project located approximately 40 km west of the village of Tonota and envisaged the project as a coal- based integrated mine- mouth power plant, with potential for the incorporation of a solar component. However, following the positive results of an extensive due diligence process regarding the agreement with South Africa- based Industrial Green Solutions ( Pty) Ltd ( IGES), plans have changed. “First, we are delighted to be progressing with this exciting opportunity to develop waste to energy projects within South Africa as momentum in the global clean energy revolution increases. “Set against this background, we believe that it is appropriate to refocus our strategy to utilise our team’s expertise and contacts as well as partnerships in the energy sector to rapidly grow our renewable energy portfolio and capitalise on what, in our view, is a ubiquitous growth story that will run for many years,” said Louis Coetzee, Chief Executive Officer of Kibo.
He said shifting the company’s primary focus to renewable energy projects will provide the company with the opportunity to develop projects with much smaller CAPEX requirements and with a significantly shorter route to revenue generation that is associated with much less risk and access to a far wider and cheaper array of non- dilutive funding options. Kibo believes it will continue to play a key role in Africa’s energy dynamics, citing that a larger entity would be better placed to take coal- fueled power projects to production.
“We hope to maintain exposure to the significant upside potential of these projects but have decided to step down from our role as their primary funder and developer. We look forward to updating the market further on the agreement, the disposals and our refocused strategy,” Coetzee said. According to the company’s directors, clean coal- fueled power projects will continue to be necessary for a transitional period of some decades to support Africa’s rapidly increasing energy requirements. Kibo has been developing three utility scale, coal- fueled power projects, located in Tanzania, Botswana, and Mozambique. The company’s decision comes as global governments gather pace on reducing reliance on carbon fuels within their energy strategies. “With this background, the company undertook a review of operations to establish the best way to extract the substantial value it had created in its coal- fueled projects for shareholders,” said Coetzee.