Edenville Energy Plc (LSE:EDL), a UK-based energy and mining company, has recently been granted with a mining license by Tanzania’s Ministry of Energy and Minerals (MEM) to develop its Rukwa coalfields project in the country’s south western region.
The company plans to invest USD 176 million in an open-pit coal mine and a 300 MW coal-fired power plant.
According to the MEM, the Rukwa coalfields project will start mining operations in June, 2016, and the coal-fired power plant is planned to start construction works between February and April, 2017, after the Environmental Impact Assessment (EIA) is culminated.
Edenville CEO, Mr. Rufus Short, explained that the mining company is thankful with the vote of confidence given by Tanzania’s Minister of Energy and Minerals, Prof. Sospeter Muhongo, whom together with his teamwork have backed the Rukwa coalfields project to support industrial and power generation development.
Tanzania currently generates less than 1% of its total capacity installed of 1,754 MW from coal-fired power plants that are fully supplied by imported coal according to the African Development Bank (AfDB).
In 2013 Tanzania imported USD 1.35 million of coal briquettes to supply its coal-fired power plants, mostly from Malawi, accounting for 86% of the total imported according to the Massachusetts Institute of Technology (MIT).
This is why the government is closely working with other energy and mining companies with the support of the National Development Corporation (NDC) to boost coal production, reduce imports and raise power generation as in the Ngaka Thermal Coal project, a proposed 600 MW coal-fired power plant.
According to the Tanzania Minerals Audit Agency (TMAA), the country counts with 1.5 billion tonnes of coal reserves as of 2013; however, new findings raised them to an estimated of 5 billion tonnes.