Australian junior Invictus Energy, and One Gas Resources have executed an updated Gas Supply Memorandum of Understanding (MoU) with Mbuyu Energy, a Zimbabwean consortium led by IPP developer Tatanga Energy.
The consortium, which includes existing Invictus’ institutional shareholder Mangwana Opportunities Fund, is seeking to develop a 500MW Gas to Power project.
“Following the recent confirmation of the discovery of gas (in Mukuyu-2 Sidetrack) at the Cabora Bassa Project, the updated MoU builds on the previous MoU signed in December 2019 with Tatanga Energy”, Invictus declares in a statement.
If indeed an economically sizeable reserve base is proved up in that discovery, then this MoU on gas supply has effectively inaugurated Zimbabwe’s domestic gas market.
The MoU is a precursor to the negotiation of a full Long Term Gas Sale Agreement (GSA) to supply sufficient gas to power the proposed plant.
The plant can be expanded in future phases to up to 1,000MW (equating to a forecasted demand of approximately 1.4Trillion cubic feet of natural gas over 20 years).
“The updated MoU will see the parties work together to assess the feasibility of developing the project utilizing gas produced from the Mukuyu field or any other field developed in the Cabora Bassa project”, Invictus explains.
“The project will be designed to minimize its environmental footprint and will utilize an efficient Combined Cycle Gas Turbine configuration (CCGT) that will incorporate cutting-edge carbon”, Invictus explains. reduction technologies.
“The development of the Gas to Power Project will be synchronized with the broader development of the Mukuyu field and the Cabora Bassa project as a whole including gas production, transportation and the processing infrastructure required to provide natural gas feedstock to the power plant”, Invictus avers.
Preliminary feasibility studies have identified a number of suitable locations that provide the ability to supply electricity through the local grid as well as potentially export to customers through the Southern Africa Power Pool (SAPP).
The Mukuyu gas field is located within 100 kilometres of three (3) major interconnectors to the SAPP grid which provides the ability to export power to any country in the region. Mbuyu will enter into discussions with a number of existing high energy demand power offtakers including large scale miners, industrial and other large-scale users of energy – many of whom currently import their electricity from neighbouring countries. The project will supply much needed reliable and affordable baseload power to these companies.
The ability to source reliable baseload power from a new domestic supply will provide significant economic benefits to potential customers many of whom have had to curtail operations and expansion plans as a result of the power deficit the country is currently facing.
This is the second major Gas Sale MoU executed for the Cabora Bassa project following the MOU executed with Sable Chemicals to provide gas feedstock for the manufacture of ammonium nitrate fertiliser which is currently supplied by rail from South Africa.