Ncondezi Energy Limited is pleased to announce that it has signed a Joint Development Agreement with China Machinery Engineering Corporation (“CMEC”) and General Electric Switzerland Gmbh (“GE”) to co-develop and construct the integrated Ncondezi 300MW coal fired power project and coal mine in Tete, Mozambique (the “Project”). This is a region which is not connected to the national grid and with low levels of electrification today. The JDA formalises certain of the key terms on which the Project will be co-developed and, constructed by Ncondezi, CMEC and GE (together the “Parties”). The JDA was executed by senior representatives at a Beijing signing ceremony, including CMEC President Mr. Han Xiaojun, GE Steam Power President & CEO, Mr. Michael Keroulle, and Ncondezi Chairman, Mr. Michael Haworth. JDA signing follows the Project’s recent inclusion by Chinese and Mozambique governments on the list of key infrastructure projects at the 2nd China-Mozambique International Cooperation Summit held in the first half of 2019. Ncondezi is expected to hold a 40% equity interest in the Project.
Project Steering Committee to be setup with representatives from each Party to manage the development process to Financial Close (“FC”), the point at which first funds are drawn for Project construction. CMEC will be the main Engineering, Procurement and Construction (“EPC”) and Operations and Maintenance (“O&M”) contractor for the Project.
GE will be the exclusive subcontractor for the power project core technology, including the boiler, steam turbine, generator, and air quality control solutions which will ensure the plant meets the emission standards established by the World Bank. GE will also supply the required parts and serve as a field advisor for the power plant maintenance.
The JDA is the key outstanding milestone to formally engage with the Mozambican Government and state power utility, Electricidade de Mocambique (“EDM”), on the electricity tariff and key Project commercial agreements such as the Power Purchase Agreement (“PPA”) and Power Concession Agreement (“PCA”).