Edenville Energy PLC (LON:EDL) Chief Operating Officer Mark Pryor caught up with DirectorsTalk for an exclusive interview to discuss the mining licence granted by the Tanzanian government, what this means for the company, their next steps and moving forward in 2016
Q1: First off, congratulations on your recent news that the Tanzanian government have granted Edenville its mining licence. Mark, can you tell us about more about what this means for the company?
A1: Well thank you very much Giles for the chance of giving this chat. As you realise, this is a major step forward in the process of an eventual coal-to-power project for not only Edenville Energy but for Tanzania and now that Edenville has this mining licence, the project can advance. The granting of the mining licence has, in effect, significantly de-risked the coal project and makes it now very appealing to power groups who would debt-fund at the project level. The granting of the mining licence means we now have secured the fuel source without which the project could not advance. The granting of the licence was based on a feasibility study and this took time, the stead work in fact took close to 2 years and I realise at time shareholders became frustrated but there is a path to success and at times patience is required. Now we are eventually here and in fact we’re the leaders of the pack, we are now at the forefront of being the first company to have obtained all the required permitting licences in securing the fuel source for the coal-to-power project, the first we are and very few people realised that. The feasibility study that was required in order to obtain our licence included not only our environment impact assessment that we issued in 2014, a mine plan, but also an extensive labour and corporate social responsibility programme ensuring that the workforce is, where possible, sourced locally, a training scheme will be initiated so that in areas where skilled workforce is currently not available, this will be addressed, for example, Edenville Energy’s coal-to-power project will be ground-breaking in that we shall be erecting the first ever clean coal-based thermal power station in Tanzania. The expertise will initially have to come from overseas to train the Tanzanians who will eventually be running the coal-to-power project. As a result of this work, and as I said previously has taken almost 2 years, we can now discuss directly with Tanesco, the electricity supply company, with regard to a power purchase agreement as well as a transmission line agreement and that has been made possible because we have a mining licence and we have secured the fuel source. Before securing any fuel source, any discussions with Tanesco are basically meaningless because if you were to have no fuel you can’t produce power, we’re now at the stage where we have the fuel source secured, now we can discuss about going forward with the power option and this is a significant step in any power company’s way forward.
Q2: Now as you’ve said this is a major milestone for the company to meet, what are the next steps?
A2: Ok, well the first things we must do is we have work schedules and timelines that we need to discuss with the various ministries, the mining licence states that we have to begin operations at Mkomolo within 3 months and that commercial production has to commence within 18 months thus there is a lot of work to do. We would start off with ground work, the upgrading and building of the access roads, currently most of these are 4×4 roads, these would have to be contoured in able to get heavy machinery to site. We need to complete a final mine plan and all that is associated with a start-up operation, hiring the personnel to support the operation, selection of contractors and equipment required for the project and we will continue this until hopefully a start-up later this year with the stripping operation and hopefully the Minister of Mines, the Hon. Professor Muhongo, will be one of the people opening our project later this year. Now obviously that is the operation side of things, in parallel we can, with confidence, discuss with Tanesco the power purchase and transmission line agreements and hopefully come to a successful conclusion. Tanesco are building the 400 kV power line down the western side of Tanzania which will run within 5-12km of our proposed power plant and all this makes for a very exciting year. Obviously lots of work to be done and EIA for the power plant and the bankable feasibility are now in process after this good news of the granting of the mining licence.
Q3: Like you said, this leaves you well placed to act on your ongoing strategy, do you think 2016 is going to be a good year for Edenville Energy?
A3: I think it’ll be an excellent year for the business, we’ve started off superbly. The granting of the licence has basically changed Edenville significantly, we’re now in the place that we’ve been longing to get to for many of years, we’re now here, we can now go forward, we can bring money into the company and we can now start building what we’ve dreamed of since we listed in 2010.
