REG - Kibo Energy PLC - Operational Update: 2023
01/02/2023 07:00
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RNS Number : 4685O Kibo Energy PLC 01 February 2023
Kibo Energy 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: 7am 01 February 2023
Kibo Energy PLC ('Kibo' or the 'Company')
Operational Update: 2023
Kibo Energy PLC (AIM: KIBO; AltX: KBO), the renewable-energy-focused
development company, is pleased to provide an operational update, following an
eventful but productive year of dedicated hard work amidst extraordinary
challenges.
In accordance with the Company's existing operational policy, the Kibo
Executive Management team conducted an extensive review of the Company's
project portfolio at the end of 2022, which included an operations review. The
key elements of said operational review are discussed below.
Portfolio
The Kibo Group strategy, as previously announced in a Company RNS dated 19
April 2021, is focused on developing, owning and operating sustainable energy
solutions that can immediately and progressively address the acute energy
challenges in sub-Saharan Africa, the United Kingdom and Ireland. The Company
achieves this by acquiring and developing energy assets that can be brought
into production within an 18-to-24-month timeline. This strategy is evident
from the comprehensive project portfolio set out in the Q4 2022 Corporate
Presentation on the Company's website and which should be read in conjunction
with this RNS.
The table below indicates the status of Kibo's Project Portfolio to date. This
does not include project opportunities that are currently the subject of
advanced due diligence and commercial consideration.
Kibo Group Project Portfolio
Entity Kibo Equity Strategic Domain Projects Development Status High-Level Indicative Milestone
MAST Energy Developments (UK) 57.86% Reserve Power Pyebridge (9 MW) Operational and generating revenue
Bordesley (5 MW) Advanced project development Financial close - Q1 2023
Installation of gas and grid connection - December 2023
Commercial operation - March 2024
Rochdale (4.4 MW) Advanced project development Renewed and updated planning consent - Q1 2023
Financial close - end Q2 2023
Hindlip Lane (7.5 MW) Concept stage Updated EPC and O&M contracts - Q3 2023
Financial close - Q4 2023
Stather Road (2.5 MW) Concept stage Determine date at which grid connection is available - Q1 2023
Rest of milestones TBD once the above has been established
Sustineri (SA) 65% Waste to Energy CHP project to supply base-load electricity generation in South Africa with 4 Phase 1 (2.7 MW + study on synthetic oil production) Advanced project development stage Feasibility study update on oil production addition - Q1 2023
revenue streams: electricity, gate fees and potentially from heat and steam
output as well as the production of synthetic oil.
Completion of integration study and finalization of off-take agreement for oil
production - Q2 2023
Financial close - Q3 2023
Phase 2 (targeted 20 MW) Pre-concept stage Milestones TBD once Phase 1 has been executed
National Broadband Solutions (SA) 51% Long Duration Energy Storage Simultaneous concept and commercial development Projects to be announced as off-take agreements are finalized with
finalization of first agreements expected during Q1 2023
12.3 MW in development
36.32 MW target for development Under development
Mbeya Power Project ("MPP") (TZ) 100% Biofuel 300 MW short-term conversion to renewable energy biofuel Original project. Completion of concept study for conversion of MCPP project to
bio-coal - Q2 2023
Fully permitted with Bankable Feasibility Study completed
Completion of Power Purchase Agreement with TANESCO - Q3 2023
UK Portfolio 100% Waste to Energy Southport (10 MW, 2MW long duration energy storage and Completion of front-end engineering and design (FEED) study - Q1 2023
5.5m m(3) bio-methane)
Submission of environmental permit application - Q2 2023
Submission of green gas supply scheme application - Q2 2023
Financial close - Q2/Q3 2023
Katoro Gold 20.88% Precious and strategic minerals katorogold.com
Notes
The notes below address the most recent announced initiatives in the interest
of providing additional context.
Waste to Energy
The plastic-to-syngas project in South Africa, Sustineri, as announced in an
RNS dated 17 January 2023, has commenced with an optimisation and integration
study into the production of synthetic oil from non-recyclable plastic waste,
thereby adding a potential accelerated additional revenue stream to the
project. Since synthetic oil is formed as part of the plastic-to-waste
pyrolysis process to produce syngas, the production thereof would require a
slight amendment to the process as was designed in the feasibility study phase
for syngas in the electricity generation process. This implies that the
Project can be developed for execution in two distinct phases, with a first
phase being the production of synthetic oil and a second phase the production
of syngas and electricity.
The decision to pursue the production of synthetic oil as part of phase 1 is
expected to have a positive impact on the Project's profitability and provides
the Company with the opportunity to generate revenue much earlier than
initially projected. Additionally, it provides an opportunity to construct and
commission the pyrolysis plant and related infrastructure earlier, thereby
facilitating early revenue. Finally, it also contributes materially to
de-risking the Project and will make the Project significantly more attractive
to a wider spectrum of interested funders, thereby reducing the funding risk
and improving the ability to secure said financing.
As the optimisation study is already underway, it is believed that a technical
conclusion may already be reached by end of Q1 2023. As the major project
technical and commercial milestones have already been achieved, this will
allow the accelerated completion of the funding discussions and commencement
of project execution.
Biofuel
The Company, after determining the technical feasibility of the production of
bio-coal from biomass, is currently determining the commercial viability of
this process under a variety of industrial scale applications. In this regard,
the company is undertaking both due diligence investigations and participating
in advanced discussions on several projects.
Apart from potentially providing a sustainable fuel source for the Mbeya Power
Project and subsequently potentially for the two remaining 300MW projects in
the Kibo portfolio (i.e. MCIPP and Benga) as well, there is an opportunity to
source and/or cultivate biomass to produce bio-coal at strategically placed
biofuel production plants for various leading international companies in the
manufacturing industry. The Company is working closely with these
manufacturers, who operate a significant number of manufacturing plants in
Southern Africa, to complete extensive feasibility studies at identified
operating plants. To this extent the Company has already determined and agreed
on a roll-out plan to supply some of these operating plants with their total
fuel requirement in the form of biofuel, completely replacing their current
dependence on coal.
Immediate and Short-Term Focus
In executing the Company's strategy referred to above, the Company continues
to actively execute the following strategic work streams:
· Exit coal by a disposal process of its coal assets, all of which are
in southern and eastern Africa (RNS dated 16 June 2021). This process is still
underway, and the Company has entertained various approaches/offers since and
is currently considering a definitive term sheet in this regard which, should
it be agreed, the Company expects to announce. The Company's various coal
assets are however faced with some fundamental challenges, of which the
following are the most important:
o Funding for the construction of new coal mines is not readily available,
especially for thermal coal deposits;
o All the Kibo coal assets are situated in very remote areas with very little
to no existing infrastructure, far away from any export port (more than 800
km) and with no significant local coal market; and
o The Kibo coal assets are thermal coal deposits and, although thermal coal is
in big demand now, it does not command a premium price, which makes such
deposits less attractive for exporters, especially when considered in
conjunction with the above two points.
· Convert its African electricity-generating asset fuel supply from
coal to biofuel technology, subject to proven technical and commercial
feasibility (RNS dated 25 August 2022).
· Identify and secure South African and United Kingdom Waste to Energy
("WtE") and flexible/reserve-power projects (RNSs dated 18 May 2021 and 19
April 2021, respectively).
· Enter the Long Duration Energy Storage ('LDES') market, comprising
Battery Energy Storage Systems ('BESS') integrated with utility-scale and
microgrid renewable energy solutions (RNS dated 17 May 2022).
· Realise shareholder value with the continuation of its spinout
strategy, whereby the Company's WtE and biofuel projects to be potentially
held in a new AIM-listed vehicle. Ultimate Sustainable Energy LTD ('USE'), is
being prepared for listing on AIM via an initial public offering ('IPO').
(See RNS dated 29 September 2022). In this regard, as part of planning and
preparation of the IPO referred to above, the Company has identified a Nomad
and Broker and is in advanced negotiations towards agreeing engagement and
mandate letters with a view of completing the IPO during Q2 2023.
Corporate Update
At the start of the new year, in an RNS dated 11 January 2023, the Company
announced the appointment of Beaumont Cornish Limited ('BCL') as its new
Nominated Adviser (NOMAD). The Company furthermore welcomed Ajay Saldanha as
an independent non-executive director to its Board of Directors. Ajay Saldanha
(aged 47) is an experienced banking and investment professional with more than
20 years of experience in the power, energy and utilities sector.
The Company is currently sufficiently funded through its existing financing
facilities, assuming deferral or otherwise settlement in equity of the bridge
loan facility announced on 16 February 2022 and £660,000 Convertible Loan
Instrument held by Kibo executive management and directors, to cover
operational expenditure for the short to medium term while the Company
actively pursues various funding opportunities. These include equity, debt and
project financing, to fund the ongoing development of the various projects
within the Kibo Group Project Portfolio and to bring the advanced projects, as
outlined above, to Financial Close as soon as possible. Most of the projects
included in the Project Portfolio are in advanced stages of development and
Kibo is working towards achieving Financial Close for all the advanced
projects during the course of 2023, with the specific exclusion of the Mbeya
Power Project where Financial Close can realistically only be achieved during
2024.
Louis Coetzee, Chief Executive Officer and Non-Executive Chairman of Kibo
Energy, says: "We are pleased with the progress we have made since announcing
our re-focused strategy to pivot to renewable/alternative energy in 2021. In
following this strategy, Kibo has built a robust and diversified project
pipeline and bolstered its project development capacity. This diversified
portfolio sufficiently de-risks the Kibo strategy execution from Management's
perspective and has successfully propelled the Company to a position where it
currently has the realistic expectation of seeing several projects in revenue
generation status over the next 12 to 24 months.
The Company has furthermore strengthened its in-house capability significantly
with management and project teams that have extensive skills, knowledge and
experience in the renewable energy sector. In this regard, the Company has
also recently concluded negotiations with a well-respected international
executive in the long-duration energy storage industry to join the Kibo team
in heading up the Company's renewable energy and long-duration storage
business division. Further announcements will be made in this regard as soon
as a commencement date has been finalized.
2023 promises to be an eventful year for Kibo and we look forward to providing
the market with further updates in due course."
This announcement contains inside information as stipulated under the Market
Abuse Regulations (EU) no. 596/2014.
**ENDS**
For further information please visit www.kibo.energy (http://www.kibo.energy/)
or contact:
Louis Coetzee info@kibo.energy (mailto:info@kibo.energy) Kibo Energy PLC Chief Executive Officer
James Biddle Roland Cornish +44 207 628 3396 Beaumont Cornish Limited Nominated Adviser
Claire Noyce +44 20 3764 2341 Hybridan LLP Joint Broker
Damon Heath +44 207 186 9952 Shard Capital Partners LLP Joint Broker
Zainab Slemang van Rijmenant zainab@lifacommunications.com (mailto:zainab@lifacommunications.com) Lifa Communications Investor and Media Relations Consultant
Johannesburg
01 February 2023
Corporate and Designated Adviser
River Group
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