Message Ven 11 Sep 2015 13:45

Maamba Collieries ça avance..

Integrated coal project achieves financial closure 11TH SEPTEMBER 2015

Coal miner Maamba Collieries’ fully integrated coal and power project in Zambia reached financial closure at the end of July, financial advisory firm Cresco Project Finance reports.

The project, which is 80% complete, comprises the redevelopment of the existing coal mine and the construction of a mine-mouth, coal-fired thermal power station and related infrastructure near the town of Maamba, in Zambia.
Cresco was appointed joint financial adviser along with financial institution Barclays and was responsible for the transactional and project finance advisory services.
“These included a comprehensive analysis of risks and the identification of solutions to mitigate such risks, preparation of the project information memorandum, the development of an optimal commercial funding structure and the development of a robust financial model for the project,” the company notes.
11/9/2015 Mining Weekly ­ Integrated coal project achieves financial closure­version/integrated­coal­mine­and­powe r­project­achieves­financial­closure­2015­09­11 2/3

Power Project
The 300 MW coal-fired power project, fully integrated with captive coal mining, is estimated to cost about $830-million, Cresco notes.
The power plant further has the required infrastructure to scale up in line with the growing demand. “The plant’s capacity will be increased to 600 MW in the second phase, depending on the build-up of demand for power in the region,” according to Maamba Collieries’ website. The company has total estimated reserves of 140-million tons, comprising high-grade and thermalgrade coal, spread over 1 070 ha out of a total concession area of 7 900 ha at Maamba.

Supply Agreement
Maamba Collieries has the largest coal mine in Zambia, and has signed a 20-year power purchase agreement to supply 100% of the power plant’s output to Zambia State-owned power utility Zambia Electricity Supply Corporation.
The project is scheduled for commissioning by mid-2016, whereafter business conglomerate Nava Bharat will be responsible for the operation and maintenance.
“Given the shortage of, and necessity for, electricity in Zambia, as well as the wider region, the project is to provide much-needed dependable and sustainable base-load power, which is crucial for the country’s economic growth and its energy security,” Cresco notes.

Nava Bharat (Singapore), a wholly owned subsidiary of India-listed business conglomerate Nava Bharat Ventures, holds 65% of the equity stake in Maamba Collieries. Investment group ZCCM Investments Holdings (ZCCM-IH) holds the balance of the equity stake.
Nava Bharat Ventures has diversified interests in power generation, mining, ferroalloys and agriculture.
ZCCM-IH is quoted on the Lusaka, London, and Euronext stock exchanges, and has the majority of its investments held in the copper mining sector of Zambia. The company’s shareholders are the Zambia government, with an 87.6% shareholding, and private- equity holders, with 12.4%.
The project is being funded through a debt:equity ratio of 70:30. The long-term loans are being advanced by a consortium of lenders comprising large inter- national commercial banks, together with development financial institutions, on a limited recourse project finance basis, Cresco explains.
Development financial institutions include the Development Bank of Southern Africa and the Industrial Development Corporation of South Africa, while commercial banks include the Bank of China, the Industrial and Commercial Bank of China, Standard Chartered Bank and Barclays Africa.
Cresco highlights that this is the first private power project in the sub-Saharan region to receive export credit agency insurance cover from China Export & Credit Insurance Corporation, also known as Sinosure.
“This combination makes it a unique collaborative project in Africa, incorporating sponsors from Singapore and Zambia, principal contractors from China and funding by financial institutions worldwide,” Cresco concludes.