AIM listed Sable Mining Africa Ltd is confident of averting Zimbabwe’s current power challenges through the development of a coal-fired power station.
Sable Mining chairman Jim Cochrane yesterday said the company is confident that the development of a coal-fired power station in Zimbabwe would be a major step forward in tackling the current power crisis.
“Considering the energy deficit in Southern Africa and increasing importance placed on energy security worldwide, the (Sable) board believes the development of a coal-fired power station in Zimbabwe would be a major step forward in tackling this crisis and one which would receive governmental support.
“With Zimbabwe and the wider southern Africa region experiencing a power deficit, Sable Mining has identified an opportunity to address the shortage as a potential coal producer and in respect of power plant development,” said Cochrane.
In September this year, Sable signed a Memorandum of Understanding with CITIC Construction, a Chinese based construction and services provider with a view to develop a 600 Megawatts coal-fired power plant at the Lubu coal project.
Under the terms of the deal, Sable Mining and CITIC will explore opportunities of using their respective expertise to work together in developing a commercial coal-fired power station with the intention of using coal mined at Lubu Coal Project supplying the station.
Sable Mining’s coal interests are located in the Mid Karoo Zambezi coal basin in the established Hwange mining district which has an initial modelled in-situ seam tonnage of 786 million tonnes and in the adjacent Lusulu area of the Kariba Coal Basin which has a suggested in-situ tonnage of 550 million tonnes.
Cochrane said the company is evaluating opportunities to move forward with development plans.
“We’ll update the market in due course with further updates although at this stage it’s difficult to provide a clear timetable with confidence.
“The board is therefore reviewing activities to suit the current environment and to ensure that the existing cash is deployed in a manner consistent with current global trends,” said Cochrane.
Sable Mining chief executive Andrew Groves said due to shifting commodity demand fundamentals the company is focused on ensuring prudent allocation of resources in order to reduce capital outlay.
“We signed an important Memorandum of Understanding with CITIC Construction relating to the development of a coal fired power plant at our Lubu coal project and finalised certain key technical studies relating to our Nimba project.
“We remain convinced that there remains future value in Nimba and are constantly evaluating options to ensure that maximum value accrues to our shareholders.
“While we operate in this uncertain and depressed environment we’re also evaluating additional projects that have potential to generate shareholder value,” said Groves.
Sable Mining also has Nimba Iron Ore Project in South East Guinea that is now heading towards full feasibility. Nimba was discovered by the company’s geologists in early 2012 and has been proven to be a high-grade, low-capital intensity asset.