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BREAKTHROUGH MINERALS LIMITED — Capital/Financing Update 2014
Apr 22, 2014
64579_rns_2014-04-22_6fd628e9-c2a8-4cb6-8620-7b4048ea5dad.pdf
Capital/Financing Update
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23 April 2014
Company Announcement Officer Australian Securities Exchange
Dear Sir/Madam
INTRA ENERGY EXECUTES A MEMORANDUM OF UNDERSTANDING WITH ENDEAVOR ENERGY POWER HOLDINGS LIMITED TO ASSESS THE JOINT DEVELOPMENT OF A 120-MEGAWATT COAL-FIRED POWER PLANT IN THE SALIMA DISTRICT OF MALAWI
Intra Energy Corporation Limited (IEC) is pleased to announce that it has executed a memorandum of understanding (MOU) with Endeavor Energy Power Holdings Limited (Endeavor) to assess the potential joint development of its 120 megawatt (MW) Pamodzi coal-fired power project in the Salima District of Malawi. The MOU sets out the intention of IEC and Endeavor to evaluate jointly developing the project and to negotiate a Joint Development Agreement subject to satisfactory completion and results of due diligence and all required approvals.
Project Pamodzi is expected to primarily utilise coal from IEC’s Malcoal mine in northern Malawi, with potential supplementary supply from IEC’s majority owned Tancoal mine in southern Tanzania. The coal supply is expected to be transported to the power plant by barge on Lake Malawi.
Endeavor is an international independent power project company headquartered in Houston that is focused on developing and investing in power generation facilities in Africa. Endeavor was formed in June 2013 following an initial commitment from leading energy-focused global private equity firm Denham Capital’s $3 billion Fund VI. Following its formation in 2013, Endeavor partnered with international power developer Joule Africa to develop and construct the US$800 million Bumbuna Phase II Expansion Power Project, a hydroelectric power project in Sierra Leone.
Endeavor is led by a group of industry professionals with extensive experience in developing, financing, constructing and operating power generation and natural gas infrastructures in emerging markets. Endeavor’s management team has been significantly involved in the development of natural gas, biomass, wind, solar and coal power projects resulting in the completion of more than 25 power projects in 16 countries with a capital investment in excess of $3.3 billion.
IEC believes that Endeavor will be an excellent strategic co-developer for Pamodzi Project as it has extensive development, financing and technical expertise.
Investec Bank Plc was engaged as financial adviser to identify and select joint venture equity partners to invest in the project.
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Malawi has coal resources sufficient to support base load electricity generation. Project Pamodzi can generate sufficient and reliable electricity and be replicated in stages to up to 240MW to support the growth needs of Malawi power generation sector. In addition, supplying Project Pamodzi with Malawi-sourced coal will result in a greater share of the economic benefits of the power station remaining in Malawi.
According to the World Bank, only 8 per cent of Malawi’s population of approximately 16 million people has access to electricity. Malawi currently has 351 MW of available capacity, which is not sufficient to meet current demand for electricity. The shortfall is projected to grow rapidly and the Malawi Ministry of Energy estimates that the country will need 603 MW by 2015 and 829 MW by 2020.
IEC has an incorporated joint venture in Malawi called Malcoal, to explore, develop and supply coal for industrial demand and supply for power. Malcoal is a joint venture between IEC (90% interest) and its local partner, Consolidated Mining Industries Limited (“CMI”) (10% interest). Malcoal acquired the Nkhachira Mining License and three Exclusive Prospecting License (“EPL’s”) in January 2013, all located in the north of Malawi, west of the town of Karonga.
In November 2013, Intra Energy completed a maiden JORC Resource Estimate for the Kopakopa Project within the North Rukuru EPL376/2013 tenement in northern Malawi. Total coal resources are 23.9 million tonnes comprising 3.5 million tonnes Measured, 4.9 million tonnes Indicated and 15.4 million tonnes Inferred category coal.
On 24 February 2014 the Company announced completion of a maiden JORC Resource Estimate for the Nkhachira Project ML143/2005 and EPL174/2005 in northern Malawi. Total coal resources are now reported at 38.4 million tonnes comprising 10.1 million tonnes Measured, 13.8 million tonnes Indicated and 14.4 million tonnes Inferred coal.
For further information please contact:
Shareholder Enquiries
Jonathan Warrand Executive Director and Chief Financial Officer Intra Energy Corporation Limited Tel: (02) 9199 5511 www.intraenergycorp.com.au
For enquiries about Endeavor Energy please contact:
Sylvester Palacios Pierpont Communications (On Behalf of Endeavor Energy) Tel: +1 713 627-2223 [email protected]
About Intra Energy
Intra Energy is a responsible developer and producer of thermal coal in Eastern Africa and is listed on the Australian Stock Exchange (ASX:IEC). Intra Energy’s focus remains “African coal for African industrial development” and is the only operating thermal coal miner in Eastern Africa. Its flagship coal project is the Tancoal mine in the Ngaka coalfield of Tanzania, operated by Tancoal Energy Limited, a joint venture with the National Development Corporation of Tanzania. Intra Energy operates the Nkhachira mine in northern Malawi through its subsidiary Malcoal Mining Limited. Intra Energy has made significant progress with its Eastern African regional expansion strategy and maintains cost effective and efficient operations to remain a low cost producer in this dynamically growing region where it occupies the prime supply position.
About Endeavor Energy
Endeavor Energy is a privately held international independent power producer (IPP) company, headquartered in Houston, Texas, focused on developing and investing in power generation facilities in Africa. Endeavor Energy is led by a seasoned management team with extensive IPP experience around the world, and a proven record of identifying and executing on project development and acquisition opportunities in Africa and elsewhere. With the financial backing of energy-focused global private equity investor Denham Capital, the company possesses significant financial and operational capability to generate and participate in multiple power development projects in Africa. Endeavor Energy is also a sponsor of the US government’s Power Africa initiative. For additional information, please call +1 (281) 369-5908 or email us at [email protected]. For more information about Endeavor, visit www.endeavor-energy.com.
About Denham Capital
Denham Capital is a leading energy and resources-focused global private equity firm. With over $7.9 billion of invested and committed capital, Denham makes direct investments in the energy and resources sectors, including businesses involving power generation, oil and gas and metals and minerals. With offices in London, Boston, Houston, São Paulo and Perth, Denham invests across the globe. Denham invests across all stages of the corporate lifecycle, from exploration and development projects to mature, operating businesses, and all segments of the capital structure. For more information about Denham Capital, visit www.denhamcapital.com.