Botswana’s 250MW IPP Project makes progress

16th October 2008

A Memorandum of Understanding (MOU) has recently been agreed between KS Energy (KSE), Botswana Power Corporation (BPC) and a major Botswana mining company (the ‘Company’), to ensure the progress of the 250MW IPP project whilst the Power Purchase Agreement (PPA) between BPC and KSE is being finalized. To ensure that the development of the 250MW power station remains on track, it is important to place the orders for the long lead-time items i.e. the gas turbine generators, transformers. This MOU ensures that this issue is addressed and in brief states the following:

·         The power plant project is split into 2 physical sites:

o    Site 1 - 90MW

o    Site 2 - 180MW

·         This MOU allows for bridge financing for the pre-engineering work and facilitates the procurement of long lead-time items;

·         The procurement includes 2 dual fuel fired, LM6000 gas turbine generator sets which will be supplied by General Electric (GE). These generator sets will run on either diesel or gas and will supply 90MW of power;

·         The intended Commercial Operation Dates (COD) are as follows:

o    1^st dual fuel turbine in Q1 2010 (45MW);

o    2^nd dual fuel turbine in Q3 2010 (45MW);

Once the PPA with BPC has been finalized, a location decided upon and financial closure reached, the equipment for the balance of the power generation capacity (180MW) will be procured and work commenced.

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