(Alliance News) - Kibo Energy PLC on Wednesday said it is moving to conclude a transaction to jointly develop a portfolio of waste-to-energy projects in South Africa.
Kibo said it intends to appoint specialist advisors to assist the company in developing and implementing a disposal strategy for its coal assets or possibly repositioning these assets to make use of alternative fuel sources other than coal, "given latest rapid advances in developing alternative fuel sources in this domain".
"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," Chief Executive Louis Coetzee said.
"Shifting the company's primary focus to renewable energy projects will provide the company with the opportunity to develop projects with much smaller [capital expenditure] 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."
The waste-to-energy projects in SA will convert plastic waste provided by leading waste disposal operators into syngas. The syngas will then be stored on site and fed into gas engines to generate electrical power.
A new company will be established for these projects. Kibo will hold 65% for a contribution of ZAR11.1 million, which will be used to develop the first 8 megawatt project, while South Africa-based Industrial Green Solutions Pty Ltd will hold 35% "for an equity contribution valued on the basis of a seven-project development portfolio and development expenditure to date".
The venture has an initial target of generating more than 50 MW of electricity for sale to industrial users.
Kibo anticipates additional acquisitions in the renewable sector in South Africa going ahead.
Shares were up 4.5% to 0.23 pence in London on Wednesday. They are up 21% so far in 2021. In Johannesburg, Kibo was quoted at ZAR0.12, unchanged.
By Greg Roxburgh; gregroxburgh@alliancenews.com
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Kibo Energy (KIBO)