HomeNewsExxaro's Thabametsi power project chosen as preferred IPP bidder

Exxaro’s Thabametsi power project chosen as preferred IPP bidder

Energy Minister Tina Joemat-Pettersson earlier this week announced that Exxaro Resource’s Thabametsi power project has been selected as a preferred bidder as part of the first bid window of South Africa’s Coal-Baseload Independent Power Producer Procurement Programme (CBIPPPP).

The Thabametsi coal-fired power station, which will be built in Limpopo adjacent to the JSE-listed miners existing Grootegeluk complex, will produce 557.3 MW of electricity for the national grid.

Coal will be supplied by Phase 1 of Exxaro’s planned Thabametsi mine, which is scheduled to produce its first coal in 2021 (and ramp-up until end 2022), in line with the development ramp-up schedule of the power station, which is expected to be operational in 2021.

Thabametsi mine Phase 1 will be developed at an approximate cost of R3 billion to supply approximately 3.9 Mtp of coal at full capacity.

The mine will, however, only be responsible for the supply of coal for a contractual period of 30 years.

Furthermore, Thabametsi’s development creates opportunities to supply coal to other coal IPPs in the Waterberg that could bid in Window 2, as well as the mining of high value coal seams for the export market.

“This is an exciting milestone for Exxaro and in realising our vision of creating jobs and powering economic development in South Africa,” says Exxaro Resources CEO Mxolisi Mgojo.

“As the largest supplier of coal to Eskom, we are already integrated in South Africa’s energy value chain and look forward to being able take advantage of the opportunities provided by current regulatory developments in the mineral and energy sectors to develop a coal mine that can supply new power-generating capacity,” he adds.

Mgojo says that company has played to its strength of coal production and partnered with competent entities such as Marubeni and KEPCO for the development of the power plant.

Exxaro anticipates working closely with all the relevant authorities to make this project a success for the benefit of all in South Africa.

The Thabametsi coal-fired power station was one of eleven proposed privately-owned coal-fired power plants which have submitted bids to sell electricity to power utility Eskom under the Coal Baseload Independent Power Producer Procurement Programme (CBIPPPP).