Eskom
ASX-listed coal miner Intra Energy Corporation has signed a Memorandum of Understanding (MOU) to develop a new coal-fired power station in Tanzania.

Intra Energy Corporation has signed the MOU with China’s Sinohydro Corporation to undertake the joint development of the 270 MW Ngaka coal-fired power station in Tanzania.

The purpose of the MOU is to clarify mutual responsibilities between the parties in both the development of the project and in government negotiations.

IEC and Sinohydro will establish a Special Purpose Vehicle (SPV) to undertake the project.

The Chinese firm will be the majority shareholder and will be responsible for the engineering, construction, operations and financing. IEC subsidiary, Tancoal Energy will be responsible for the development, mining and supply of coal to the Ngaka power station.

The Ngaka power station is designed as a 2 x 135 MW Pulverised Coal Injection plant and is expected to consume up to 1.2 Mt of high quality coal per year from Tancoal’s northern coal field. The power station will be sited approximately 7 km from the actual mine site.

It is expected to provide more than 15% of Tanzania’s current electricity generation needs through a 220 kVa transmission system.

Tancoal has a JORC coal resource of some 423 Mt and is currently mining and supplying more than 300 000 tpa into the domestic industrial market.

The MOU, signed in Dar es Salaam, is valid for 12 months or until superseded by a Joint Venture Agreement and the establishment of the SPV company.

“Both Sinohydro and ourselves have worked hard to make this project a reality and in doing so have formed a close working relationship. The MOU represents the next stage in entering into a formal relationship to bring the project to fruition,” says IEC chairman Graeme Robertson.