Kibo Mining has completed the acquisition of an 85% stake in the Mabesekwa Coal Independent Power Project (MCIPP) in Botswana from Shumba Energy subsidiary Sechaba Natural Resources.
The £9m deal was announced between the companies last November.
The MCIPP is situated around 40km east of the village of Tonata and approximately 50km south-east of Botswana’s second largest city Francistown.
Kibo plans to develop the project as a coal-based integrated mine-mouth power plant, and potentially add a solar component.
Sechaba has also been allowed to hold a 27.13% share in Kibo, under the newly completed deal.
Among others, the deal has offered Kibo the first right of refusal over any energy projects that Shumba may pursue over the next six years.
Shumba will have the first right of refusal on any coal export projects that Kibo may pursue over the same period.
The MCIPP project complements Kibo’s Mbeya Coal to Power Project (MCPP) in Tanzania.
Kibo Mining CEO Louis Coetzee said: “Ideally located in Botswana, which has one of the best credit ratings in sub-Saharan Africa, and like much of Africa suffers from acute energy shortages, the MCIPP has notable similarities with our MCPP in Tanzania.
“These synergies will enable us to capitalise on our institutional knowledge and contacts in the industry as we pursue rapid development of both projects in tandem.”
MCIPP is estimated to feature a 300t subset of the current insitu 777t Coal Resource.
As part of the transaction, Shumba Energy founder and managing director Mashale Phumapi has joined Kibo as a non-executive director.