News blog
Strategic Natural Resources
- BY: Andrew Hore |
- POSTED: 28/11/2007 |
South African power generator IPSA’s sales of a 50% interest in Elitheni Clean Coal Holdings Limited is good news for Strategic Natural Resources.
IPSA has sold the stake in ECC to Exodus Africa for a premium of $5m over its holding cost. Half of this stake will be placed with Black Economic Empowerment investment funds. Exodus is a Texas-based energy company and it wouldn’t agree to buy the stake if it didn’t feel that the project is viable.
ECC is developing a 500MW Elitheni clean coal-powered generation project at Indwe in Eastern Cape Province in South Africa. SNR will supply the coal for this power station from its proposed Elitheni mine.
SNR’s drilling programme has shown that there are enough coal reserves to supply this plant and there is potential to increase its size if the coal reserves are increased to more than 120m tonnes. So far SNR has announced a resource of 40m tonnes having sample 7% of the mine area.
ECC will initially develop a 250MW generation plant and then add additional blocks of 250MW in the future.
Shares in Strategic Natural Resources were unchanged at 32p, against a flotation price of 30p.
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