[miningmx.com] — Coal exploration and development company CIC Energy, which is developing the Mmamabula Energy Project in Botswana, on Tuesday said it had extended of its engineering, procurement and construction (EPC) contract to allow time for South Africa to approve its second Integrated Resource Plan (IRP2010).
The EPC contract was originally signed by Meepong Energy, a subsidiary of CIC
Energy, with Shanghai Electric Group, in March 2009.
CIC Energy said the extension maintains the fixed price for this lump sum turnkey contract for the engineering, procurement, construction, testing and commissioning of the power station for the Mmamabula Energy Project but the contract now extends beyond the period expected to be required for approval of the IRP2010 by the Department of Energy of South Africa.
“The extension of the EPC contract is a key accomplishment towards maintaining the Mmamabula Energy Project in a ready mode to be able to restart project development following the resolution of the regulatory matters in South Africa, regarding new power projects,” said CIC Energy president Greg Kinross.
“We remain cautiously optimistic that these regulatory matters will be resolved in the third or fourth quarter of this year, in conjunction with the gazetting of the
IRP2010,” Kinross said.
South Africa’s IRP2010 is expected to be a 20-year country plan for how South
Africa will bring on new electricity supply to meet the projected demand for power
from 2013 onwards.
IRP2010 is anticipated to include a combination of new government owned power stations and independent power producer (IPP) projects, like the Mmamabula Energy Project.
The first public consultation period for input parameters to the IRP2010 was
completed in June, and a first draft of the proposed IRP2010 approved by the cabinet of the Government of South Africa is expected to be released to the public in August.
Based on this draft IRP2010, a second and final round of public consultation is then anticipated to take place with the South African government targeting the end of September as the date to gazette the final IRP2010.
“CIC Energy intends to reassess the project development programme for the
Mmamabula Energy Project following the final approval of the IRP2010, including
seeking a further extension of the EPC contract as necessary at such time,” the
The planned capacity of the Mmamabula Energy Project power station will be
about 1,320 MW (gross) or 1,200 MW (net), comprised of two supercritical 660 MW
The Mmamabula Energy Project is being developed independently of the CIC
Energy’s smaller power station project, the 300 MW (gross) Mookane Domestic
Power Project, also to be located at the Mmamabula Coal Field.
Electricity generated from the MDPP will be targeted to supply Botswana.