Edenville Energy plc (AIM: EDL) has given DirectorsTalk an update on progress on its Rukwa Coal to Power project in south west Tanzania and its Tanzanian Licence position.
All available manpower and financial resources are now being concentrated at the Rukwa project site to enable the Company’s Rukwa Coal to Power Project to move forward. The first road building and mining equipment is expected to arrive on site this week. Initial work is planned to be the upgrading and formation of roads and storage facilities.
As the Company’s focus is firmly on the development of the Rukwa Coal to Power Project the directors have looked at the rationalisation of other licences held by the Company’s subsidiary, Edenville International (Tanzania) Ltd and in accordance with the Tanzanian government’s directive that all exploration licences need continued expenditure to remain current.
Three exploration licences in Tanzania have consequently been relinquished. These licences cover 123 sq km and are numbered PL5790, PL5659 and PL6174. The licences were originally acquired for shares at the time of the Company’s admission to AIM in 2010. They were found after investigation to contain little indication of economic mineralisation. This will allow available funds to be focussed on the development of the Company’s core asset at Rukwa.
Relinquishment of these licenses will reduce the Company’s work and licence fee commitments over the next 12 months by approximately US$250,000 and allow managerial, technical and financial resources to be focused on the development of the Rukwa Coal to Power Project. As a result of the decision to relinquish these licence interests, an impairment charge, in accordance with the Company’s accounting policies and IFRS, is expected to be made to the statement of comprehensive income in the Company’s financial statements for the year ending 31 December 2016 of approximately GBP3.6 million. The Company’s last reported Net Book Value of its Exploration and Evaluation assets including goodwill was GBP8.23 million as at 30 June 2015.
