Member Info for JDwag

To this tendering ‘exercise’ than meets the eye. It just doesn’t make a great deal of sense. If you exclude Dangote your are left with KIBO, Tancoal and EDL as pure IPP plays, I can’t find anyone else. Kibo are well advanced, Tancoal are 2 years behind us I think and EDL are behind that. The TG know this of course! Add in the fact that the SML is being readied in the TG Mining Portal to be carved out of our PLs and issued IMHO (they have already issued us fresh PL extensions to some of these new areas) they clearly don’t have an issue with our SML application? Left scratching my head.... JD

http://www.africanminingnetwork.com/news/tanzania-study-for-ngaka-mine-mouth-power-station/ Now two years out of date however I still believe this is as far as the technical and financial feasibility has gotten. Interesting to note that it's over 7km from mine to plant, they have to truck it there and they haven't even got to the transmission feasibility yet. The latest news I can find is in August 2018 the two companies reconfirmed the MoU (article below). However, it's two years or so behind us and no idea of what final feasibility and cost might be: https://www.ippmedia.com/en/business/tancoal’s-parent-company-intra-energy-reports-improved-coal-sales JD

I believe part of their ‘deal’ was SinoHydro had to finance a DFS which hasn’t been undertaken yet. So no idea if it’s feasible, then there is the cost, MCPP will be built under the new interconnector and Mbeya substation, that’s why it always worked, other projects have to work out how to connect to the grid. Intra Energy are now fighting an Administration order against a local subcontractor and as of today have an MCAP of £2m and a bit pounds sterling. They have issues. JD

No such classification as a ‘conditional’ SML. Once the Cabinet sign off on the mining Commission green light, it’s an SML. Clearly all constituent criteria is in place for the Mining Commission to give its ‘approval recommended’ we now await the Cabinet sign off. These are two separate things. JD

Just going back over EDL and Intra Energy (Tancoal) News.

Both have Sinohydro as their prospective power partner. The competition isn’t really competition, both SEPCO3 and Sinohydro’s direct parent company is the China Power Construction Company. So, you have to ask if Sinohydro has even bothered to tender if it’s state sister company is tendering with Kibo (confirmed) and wants to take a stake in them (confirmed).

JD

AUD$5m, sorry, so less than a £3m MCAP (that went down 21% today).

JD

It will be interesting to see how many have tendered. It will slip out over the weekend / next week being a public tender.

The withdrawal from BITS is a massive issue BTW, fine for the Chinese, but for a public listed western company, you’d run a mile from Tanzania at the moment.

Intra Energy (70% owners of Tancoal and the host of the potential 200mw CTPP) currently has an MCAP of approx. 5m. They can’t fund the pre development costs either.

JD

Don’t be surprised if this turns out to be a tender of one.

EDL? No idea how they could fund it, years off us on the Power side of things.

Tancoal? Fighting off an administration order in High Court, no DFS, so years to do it.

Dangnote?

JD

SirG, as you understand it, what was holding SEPCO3 up in their buy in?

JD

I think that is about right, Sonic.

JD

Sonic, i think timelines depend on who / how many tendered for this. We should find out numbers today. I'm expecting three / four tenderers.

JD

I can only count 4 No. possible tenderers. Kibo, EDL, Tancoal and (maybe) Dangote? On a pure basis IPP who else is there?

JD

So all PLs and SMLs have now been completely segregated along clean lines with all PLs having been granted (2 No. being granted this week) and because of the sub-division two new PLs have been applied for because they are ‘new’ parcels of land.

Looks like they are clearing the decks for the SML, before end of October I think.

JD

Interested to find out how many tenders where received full stop!

JD

In a ‘normal’ tendering environment you would expect a ‘competitive tender’ to deliver you the best price possible, however, in this circumstance? I just don’t know what the TG are expecting. To get to Kibo’s stage you’ll need to spill some USD$25m in upfront costs to get you to this point. No one is doing that in the current investment conditions in Tanzania, therefore, we are going to have a tender exercise of wildly varying qualities. The delay is never great, but I’m happy we will still end up with a nice piece of the pie here.

JD

Disappointing, but at least we now know, it’s a competitive tender and this now supersedes the PPA.

No one will come close to us in terms of advancement so we are still in great shape, just a longer burn in terms of MCPP. I also seriously question what others will even put in here? How do you tender for something (without a feasibility study) you don’t know what it will cost or if your project is, eh, feasible?

JD

Disappointing, but at least we now know, it’s a competitive tender and this now supersedes the PPA.

No one will come close to us in terms of advancement so we are still in great shape, just a longer burn in terms of MCPP. I also seriously question what others will even put in here? How do you tender for something (without a feasibility study) you don’t know what it will cost or if your project is, eh, feasible?

JD

Hugely positive, thanks for that Mikemike. JD

I hope you are too...... Just going through the brand new website and content that was uploaded this week, it states: ‘The next steps are: 1. Finalise Power Purchase Agreement and achieve Financial Close; and 2. Commence construction phase of Project.’ So does our PPA still stand? We need to be told this tomorrow or Monday. JD

SML is the easy part, that will be forthcoming in a week or two IMHO. The PPA is the ‘known unknown’ to quote Rumsfeld....... But. We will have more clarity tomorrow / Monday. There will have to be a ‘cleansing’ RNS from LC giving us an update on which of the following it is, PPA still ongoing or its now been wrapped into the tender exercise. JD