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(Sharecast News) - Centamin announced on Thursday that the solar plant at its Sukari Gold Mine has entered the final stages of commissioning, and is delivering savings ahead of expectations.
The FTSE 250 company also reported that continued progress had been made to assess the opportunity to use Egyptian grid power at Sukari.
At Sukari, it reported consistent delivery of 36MW DC nameplate capacity, converting to 30MW AC of power since early September.
That led to a reduction in its exposure to "volatile" fuel pricing, with commissioning saving up to 70,000 litres of diesel per day and averaging a reduction in diesel consumption of 22 million litres per year.
Centamin said that translated to a potential $20m annual cost saving at current diesel prices.
There was also an expected reduction in scope 1 greenhouse gas emissions by 60,000 tonnes of carbon dioxide equivalent per year, and a subsequent reduction in the volume of diesel trucked to site.
Full commissioning was expected in the fourth quarter of the year.
Looking at the Egyptian power grid study, Centaminm said there was potential to further reduce its reliance on diesel.
The company had been in "active engagement" with government and independent power providers.
Initial proposals to supply between 30MW and 50MW AC of grid power to Sukari had been received, and an internal evaluation was underway for potential integration from 2024.
A 50MW AC grid power supply would create the potential to "fully displace" the use of diesel for power generation at Sukari.
The minimum 30MW AC grid power, combined with the existing 30MW AC of solar power, would create the potential to operate during daylight hours without using any diesel power generation, and "substantially offset" diesel consumption during night time hours.
Grid proximity to site and existing infrastructure would make for a low capital intensity, the board said, with Egyptian grid power generated from natural gas and a mix of renewables, including hydro, solar and wind, which could further reduce Sukari's greenhouse gas emissions.
There was also the potential for further cost savings, with Egyptian industrial grid tariffs "significantly cheaper" than the cost of power generation using diesel fuel.
"Delivery of this critical project is instrumental to our ongoing commitment to reduce our reliance on diesel fuel, minimise greenhouse gas emissions and realising material cost-savings," said chief executive officer Martin Horgan.
"The solar plant and potential to integrate grid power will contribute materially to our environmental stewardship philosophy and our strategic objective of maximising returns for all stakeholders."
At 1031 BST, shares in Centamin were up 2.7% at 85.82p.
Reporting by Josh White at Sharecast.com.
