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KIBO MINING PLC - Sale of Haneti Nickel Project

Release Date: 22/06/2018 08:15
Code(s): KBO     PDF:  
Wrap Text
Sale of Haneti Nickel Project

  Kibo Mining Plc (Incorporated in Ireland)
  (Registration Number: 451931)
  (External registration number: 2011/007371/10)
  Share code on the JSE Limited: KBO
  Share code on the AIM: KIBO
  ISIN: IE00B97C0C31
  (‘Kibo’ or ‘the Company’)


  Dated: 22 June 2018

                                  Kibo Mining Plc (‘Kibo’ or the ‘Company’)
                                        Sale of Haneti Nickel Project


Kibo Mining Plc (AIM:KIBO; AltX:KBO), the multi-asset Africa focused energy and resource company is
pleased to announce that its wholly owned subsidiary Kibo Mining (Cyprus) Ltd (the ‘Seller’) has sold Kibo
Nickel Limited (‘Kibo Nickel’) to Katoro Gold Ltd (‘Katoro’) in an all share transaction (‘the Sale’). This is in
line with Kibo’s strategy of becoming a major regional power player in Africa as the Sale allows it to focus on
its three energy projects currently in development.


Louis Coetzee, Kibo’s CEO said, “In line with our strategy focused on becoming a major regional power player
in Africa, we believe that, whilst Kibo Nickels’ project is very exciting, it can be better advanced within Katoro.
We continue to make progress advancing our strategy, highlighted by the acquisition announced on 6 June
2018, which expands our reach into Mozambique. Thanks to our experience in the sector and close
relationships with international development partners, including General Electric and SEPCO III, we are
becoming a preferred development partner for strategic power projects in the region. Going forward, our full
focus will be on developing our initial three energy projects and delivering value to shareholders by
capitalising on the acute power shortage in the region.”


Terms of the Sale
Under the terms of the Sale, Kibo has sold its wholly owned subsidiary, Kibo Nickel, a private company
incorporated in the Republic of Cyprus, to Katoro for 15,384,615 new ordinary shares in Katoro at a price of
1.3p per share (valued at £200,000) (‘Consideration Shares’). The Consideration Shares will be issued to Kibo
upon transaction completion and will rank pari passu with the existing Ordinary Shares. Kibo will also retain
a 2% NSR royalty in respect of nickel or mineral concentrates produced and sold from any of Kibo Nickel’s
properties.


The Sale is subject to the Parties having received the approval of any regulatory authority with jurisdiction
regarding the transaction and whose approval is required to implement its provisions.


Transaction completion will take place at 14:00 London time on the fourth Business Day after the fulfilment
of the last of the conditions, or such other date as the Seller and Katoro may agree to in writing, at the offices
of Katoro’s London Solicitors, Messrs Druces LLP of Salisbury House, London Wall, London, EC2M 5PS
(‘Completion’). The Long Stop Date for the transaction is 1 September 2018, which date may be extended by
agreement in writing between the Parties.
Separately, the Company has participated in the placement announced today by Katoro and subscribed for
5,769,231 ordinary shares in Katoro at a placement price of 1.3p per share (total cost of £75,000). Kibo’s
holding in Katoro (not including the Consideration Shares, which are yet to be issued) is now 67,602,564 shares
representing an interest of 50.43%.


The Company is focused on building a geographically diversified portfolio of strategically located energy
production assets spanning the entire spectrum of electricity generation across Africa that can solve the
increasing acute energy shortages on the continent. The Company seeks to contribute in a meaningful way to
the energy demand across three countries in southern Africa: Tanzania, Botswana and Mozambique. Its
flagship asset is the MCPP in Tanzania, which comprises the development of the Mbeya Coal Mine, a 1.5Mt
p/a mining operation and the Mbeya Power Plant, a 300MW mine-mouth thermal power station anticipated to
be in production in 36 months from the date of achieving financial close. It also holds an 85% interest in the
Mabesekwa Coal Independent Power Project in Botswana on which feasibility studies are well advanced. Most
recently, Kibo announced a joint venture in Mozambique, to participate in the further assessment and potential
development of the Benga Independent Power Project, including the right to construct and operate a 150-
300MW coal fired power station.

                                                **ENDS**

  For further information please visit www.kibomining.com or contact:

   Louis Coetzee           louisc@kibomining.com Kibo Mining Plc                 Chief Executive Officer
   Andreas Lianos          +27 (0) 83 4408365         River Group                Corporate and
                                                                                 Designated Adviser on
                                                                                 JSE
   Ben Tadd /Tom           +44 (0) 20 3700 0093       SVS Securities Limited     Joint Broker
   Curran
   Jon Belliss             +44 (0) 20 7399 9400       Novum Securities Ltd       Joint Broker

   Andrew Thomson          +61 8 9480 2500            RFC Ambrian Limited        NOMAD on AIM

   Isabel de Salis /       +44 (0) 20 7236 1177       St Brides Partners Ltd     Investor and Media
   Priit Piip                                                                    Relations Adviser

This announcement contains inside information as stipulated under the Market Abuse Regulations (EU) no.
596/2014 ("MAR").

  Notes to editors

  Kibo is a multi-asset resource development and energy company with a long-term goal of becoming a
  leading power producer in Sub-Saharan Africa. The Company aims to tackle the acute power deficit
  which is severely hindering economic development in the region.
To assist in the execution of its power projects, Kibo has assembled an international team of advisors
and partners including Engineering Procurement and Construction (‘EPC’) contractors and financial
teams that are assisting in the advancement and development of the MCPP. These include
ABSA/Barclays as Financial Advisor, China based EPC contractor SEPCO III, General Electric,
Tractebel Engineering (Power), Minxcon Consulting (Mining) and legal advisors Norton Rose
Fulbright.


Kibo’s flagship asset is the Mbeya Coal to Power Project (‘MCPP’) in Tanzania, which comprises the
Mbeya Coal Mine, a 1.5Mt p/a mining operation, and the Mbeya Power Plant, a 300MW mine-mouth
thermal power station. The Mbeya Coal Mine has a defined 120.8 Mt NI 43 101 thermal coal resource.
A Definitive Feasibility Study has been conducted on the project which underpinned its value and
confirmed an initial rate of return of 69.2%. The 300MW mouth-of-mine thermal power station has
long term scalability with the potential to become a 1000MW plant. The completed full Power
Feasibility Study highlighted a power output target of 1,800 GWh/a based on annual average coal
consumption of 1.5Mt. An Integrated Bankable Feasibility Study report for the entire project indicated
total potential revenues of US$ 7.5-8.5 billion over an initial 25-year mine life, post tax equity IRR
between 21-22%, debt pay-back period of 11-12 years and a construction period of 36 months.

Kibo also has an 85% interest in the Mabesekwa Coal Independent Power Project (‘MCIPP’), a nearly
identical power project in Botswana. The project consists of 300Mt subset of the current in-situ 777Mt
Coal Resource and has water and land use permits and environmental certification in place. A Pre-
Feasibility Study on the coal mine has been completed, as has a Scoping Study, which highlight the
power plant having a maximum capacity of 600MW (4x150MW) based on a coal delivery rate of
3.2Mtpa and a Life of Mine of over 30 years.


Furthermore Kibo also has a Joint Venture agreement with Mozambique energy company
Termoeléctrica de Benga S.A. ('Termoeléctrica') to participate in the further assessment and potential
development of the Benga Independent Power Project ('BIPP'), including the right to construct and
operate a 150-300MW coal fired power station. Kibo and Termoeléctrica shall hold initial
Participation Interests in the unincorporated joint venture of 65% and 35% respectively.

Johannesburg
22 June 2018
Corporate and Designated Adviser
River Group

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