African Energy Resources says it has executed a Joint Development Agreement (JDA) with ACWA Power International for the development of a 300 MW power station and integrated coal mine to be located at the its  Sese coal deposit in Botswana.

ACWA Power is a highly regarded international power generation and water desalination developer, investor, co‐owner and operator. Its headquarters are located in the Kingdom of Saudi Arabia with projects spread globally. Its total contracted generation portfolio is 15,731 MW of power and 2.4 million m3/day of desalinated water with an investment value in excess of USD 23 billion.

African Energy and ACWA Power have jointly submitted an expression of interest for the 300MW Greenfield Tender Request recently announced by the Ministry of Minerals, Energy and Water Resources, on behalf of the Government of the Republic of Botswana.

Under the deal, African Energy and ACWA Power have agreed to co‐operate as a single consortium for the preparation and submission of an Expression of Interest (EOI) for the 300 MW Greenfield Tender Request announced by the Government of Botswana. This submission was made on 2nd October 2013.

The two will also cooperate on the preparation and submission of a joint bid in response to a request for proposals issued by the Government of Botswana, or any other proposal requested by the Government of Botswana for the award of the Project and also To develop and implement the Project in accordance with the terms of the JDA if the consortium is successful in any bid process.

ACWA Power will be the lead developer, manager, co‐coordinator and chief point of contact of the Consortium, up to the point of financial close. Its specific roles will include the management of the Project, the financing of the Project, including the preparation and negotiation of the Financing Documents, the selection of the technology and configuration of the Power Station, the selection of the EPC Contractor and the preparation and negotiation of the Transaction Documents and the selection of the O&M Contractor and (together with AFR) the Mining O&M Contractor.

On the other hand, African Energy will act as co‐developer but with no commitment for additional developmental funding. “AFR expects forecast costs to be reduced over the next year, as some expenses dedicated to the Sese power project will be borne by the Consortium.”

According to the two, if the consortium is successful in any Government of Botswana bid process then AFR will receive a structured financial return based on the Project financial model.

“ACWA Power as lead developer and equity financier of the project will become the major shareholder in Sese Power (Pty) Ltd, the special purpose vehicle created for the project. AFR and ACWA Power recognise the potential for further power development opportunities fuelled by Sese coal and have agreed that ACWA Power will have a first right of refusal to participate in future IPP’s at Sese subject to mutually agreeable terms,” revealed African Energy.

African Energy Resources and ACWA Power as a consortium have now submitted an EOI with the Government of Botswana to build, own and operate a 300 MW coal fired power generation plant to be located at AFR’s Sese coal deposit with the ability to deliver power into the grid as early as 2016, and no later than 2019.

The move follows the release of a Tender Notice and Invitation for the EOI for the development of a Greenfield 300 MW coal‐fired power station by the Ministry of Minerals, Energy and Water Resources (MMEWR), on behalf of the Government of the Republic of Botswana in August.

MMEWR expects to determine its IPP procurement process shortly, however it has indicated that the information provided may allow it to identify projects that could be engaged earlier.

ACWA Power is a developer, investor, co‐owner and operator of a portfolio of plants with a capacity to generate 15,731 MW of power and produce 2.4 million m3/day of desalinated water. The portfolio has an investment value in excess of USD 23 billion and provides employment to more than 2,300 people in 8 countries.