Management Team and Financial Advisor Appointed

 

Kibo Mining Plc Incorporated in Ireland)

(Registration Number: 451931)

(External registration number: 2011/007371/10)

Share code on the JSE Limited: KBO

Share code on the AIM: KIBO

ISIN: IE00B61XQX41

("Kibo" or "the Company")

 

 

Dated: 8 October 2013

 

_____________________________________________________________________________

Management Team and Financial Advisor Appointed to Rukwa Coal to Power Project

____________________________________________________________________________

 

·    Kibo appoints experienced management team to manage and execute Rukwa Coal to Power project feasibility studies for both the Rukwa Coal Mine and the Rukwa Power Station

 

·    Standard Bank engaged as Financial Advisor on the Rukwa Coal to Power Project

 

Introduction

 

Kibo Mining plc ("Kibo" or the "Company") (AIM: KIBO; AltX: KBO) the mineral exploration and development company focused on gold, nickel, coal and uranium projects in Tanzania, is pleased to announce key internal and external appointments to implement and manage the three stage Rukwa Development Program (see details below), recently approved by the Kibo board of Directors. The Rukwa Development Program (RDP) is the product of extensive consultation and discussion with the Tanzanian Government, East West Power Company ("EWP") of Korea and Standard Bank Group ("Standard Bank") and will be implemented to accelerate development of its flagship Rukwa Coal to Power project ("RCPP").

 

Management Team

 

The Rukwa Executive Management Team ("REMT") has been formed comprising Kibo CEO, Louis Coetzee and Kibo COO, Louis Scheepers, along with external appointees, Roy Adair and Casper Van Wyk (See abbreviated CV's below). Mr. Louis Coetzee will chair the REMT whilst Mr. Roy Adair will assume the position of Program Executive in the REMT, with executive responsibility for the implementation and execution of the RDP.

 

All appointees bring a mix of skills and experience across the fields of executive leadership, project management, corporate finance and global energy development required to advance the project as it now enters the feasibility study stage.

 

Mr Adair has successfully served as CEO of a number of energy companies in the last 20 years including Hydro Tasmania (Pty) Ltd, Senoko Power Limited and Yallourn energy. In his most recent role as CEO of Hydro Tasmania (Pty) Ltd, he was responsible for the operation of a $5 billion business in the Tasmanian electricity market. Mr. Van Wyk brings vast experience in corporate finance and corporate structuring to the REMT.

 

Financial Adviser Appointment

 

In addition to the appointment of the REMT, Kibo has entered a 12 month, fixed term Financial Advisory mandate with Standard Bank, whereby Standard Bank will assist the REMT with:

 

·    The development and delivery of a financial model for the RCPP; and

·    The strategic planning and development of a robust project development and financing strategy for the RCPP.

 

The engagement letter also grants Standard Bank an unconditional and irrevocable right of first refusal to upon completion of the 12 month fixed term mandate:

 

·    Act as Mandated Lead Arranger for any debt financing required by the RDPP and/or

·    Act as retained Lead Financial Advisor to the RCPP

 

 

Louis Coetzee CEO of Kibo commented today: "Kibo is very pleased with these appointments. The experience and successful track records of my colleagues on the REMC should greatly benefit our planned development schedule for the RCPP. Equally pleasing is having access to Africa's largest indigenous bank and their energy advisory franchise which we trust will be of great value to the Project over time.

 

With the latest appointments, Kibo have now successfully completed what could be viewed as the most important development phase of the RCPP. This phase, referred to as the grounding phase, required that a solid foundation be created to guarantee the successful development and completion of the RCPP and this was duly realized with the following four cornerstones namely, appropriate coal resource, government support, energy generation partner (EWP) and financial advisory partner (Standard Bank), now firmly  in place."

 

Additional Information

 

Rukwa Development Plan

 

Stage 1

 

·    Completion of BFS on the coal mine by Dec 2014, which will also include;

 

o The granting of a Valid Mining Right;

o Evaluation of potential for external sale of coal locally, internationally within Africa and internationally beyond the African continent; and

o Evaluation of the potential for different use of the coal including for a coal-to-liquids plant or coal bed methane generation.

 

·    Completion of a pre-feasibility study on the power plant, by Dec 2014 that will include:

 

o Settling the basic terms of a long form term-sheet as a forerunner to a Power Purchase Agreement;

o Settling the basic terms of a Fuel Supply Agreement and Ash Removal Agreement;

o Providing an outline design for the Power Station;

o Securing the land on which the plant will be built; and,

o Arranging the requisite licenses, permits and regulatory approvals;

 

Stage 2 & 3

 

Stage 2 of the RCP will comprise all development and construction activities relevant to both the mine as well as the power plant, with Stage 3 comprising commissioning and operation of both the Rukwa Coal Mine and Rukwa Power Station.

 

REMT: Background Information on External Appointments:

 

Roy Adair

 

Roy Adair's successful career has been mainly spent in senior management positions in utilities in several different countries.  In the last 20 years he has held chief executive positions in several integrated electricity generation and retailing businesses including Hydro Tasmania, Australia and Senoko Energy, Singapore.  Roy is a successful CEO with a track record of improving the performance of a range of businesses, with a turnover in excess of US$1billion, across a broad spectrum of key areas ranging from focused business strategies, improved bottom line performance and effective asset management arrangements to the successful project management of major capital investment projects and corporate governance.

 

 Roy has worked in several African countries on a variety of energy projects.  His experience of mine-mouth electricity generation assets is of great value to the Rukwa Coal and Power project.  Roy's extensive experience of the successful delivery of high value capital projects in different countries is extremely pertinent. His track record as a board director will also be of value to the project.  While having chaired project specific, special purpose companies Roy has also sat on the boards of several large businesses in both executive and non-executive director capacities.  An economist and qualified accountant he is currently on the board of the International Hydropower Association and is Deputy Chairman of the Clean Energy Council, Australia.

 

Casper Van Wyk

 

Casper is a chartered accountant who started his professional career with Coopers & Lybrand in 1991. He also holds an MCom (Computer Auditing & Systems Development) from the University of Pretoria and an MPhil (Finance) from the University of Cambridge, England.

Casper joined Genbel South Africa Ltd in 1994 as an investment analyst in the underwriting and corporate finance department. During the next five years he was involved in numerous structured transactions on behalf of Gensec, with a specific preference for the technology- and financial service industries. He was involved in some of the first offshore financings in the South African information technology industry, and has served on the boards of public companies. He resigned his position at Gensec during January 1999 in order to join the River Group, a corporate advisory and M&A Boutique. Since 2000 Casper was actively involved in the resources sector.. As the investment cycle developed during the first decade of the 21^st millennium, he was involved either as advisor or as principal in a number of public- and private transactions in precious metals, diamonds and a number of industrial minerals. His experience covers a number of jurisdictions in Africa, Canada, United Kingdom and Australia amongst others.

 

Standard Bank

 

Standard Bank is Africa's largest bank with a market capitalisation of USD 18 billion and operates in 18 African countries. Standard Bank' Tanzanian subsidiary, Standard Bank Tanzania Ltd ("Stanbic"), routinely advises on and structures finance for public private partnerships in the country across all business sectors.

 

Contacts

Louis Coetzee	+27 (0)83 2606126	Kibo Mining plc	Chief Executive Officer
Andreas Lianos	+27 (0)83 4408365	River Group	Corporate and Designated Adviser on JSE
Jon Belliss	+44 (0) 20 3216 2630	XCAP	Broker
Stuart Laing	+61 8 94802500	RFC Ambrian Limited	Nominated Adviser on AIM
Matt Beale	+44 (0)7966 389196	Fortbridge	Investor Relations

 

 

General Background & Strategy

 

Kibo was established in early 2008 to explore and develop mineral deposits in Tanzania, East Africa and was admitted to AIM in London on 27 April 2010 and AltX in Johannesburg on 30 May 2011.  The Board of Kibo is composed of professionals whose experience include mineral exploration, mine development, mining finance, tax, law, mergers and acquisitions, and financial control of public companies. It is supported by competent and motivated a Tanzanian staff that operates from Kibo's operations office in Dar es Salaam.

 

The mineral assets of the Company comprise five projects areas in Tanzania - Haneti (nickel, PGE and gold), Morogoro (Gold), Lake Victoria (Gold), Rukwa (Coal) and Pinewood (Coal & Uranium).

 

The Lake Victoria project covering a gold prospective licence portfolio in Tanzania's premier gold mining region, the Lake Victoria Goldfield, been recently enhanced by the addition of two brownfield gold projects Imweu and Lubando. Both projects have NI 43-101 compliant total gold resource of approximately 798,000 ounces (total of Measured, Indicated and Inferred for both projects).

 

TABLE1: IMWERU MINERAL RESOURCE SUMMARY-BASECASE*
Category	Measured Resource	Indicated Resource	Inferred Resource
Resource (t)	-	-	17,649,900
Grade (g/t)	-	-	1.11
Grade (oz/ton)	-	-	0.032
Total Gold (oz)	-	-	629,600

*Numbers are rounded. Composites capped at 25g/t gold. Cut-off grade of 0.5g/t gold based on a gold price of US$850/oz and assumed100% metallurgical recovery .CIM definitions were followed for Mineral Resources.

 

TABLE2:LUBANDO MINERALRESOURCE SUMMARY-BASECASE*
Category	West Zone	East Zone South	East Zone Mid	East Zone North	Total
Measured Resource
Measured Resource (t)	107,900	4,880	16,900	54,440	184,150
Grade (g/t)	1.69	2.52	1.72	2.48	1.95
Total Gold (oz)	5,900	400	950	4,340	11,500
Indicated Resource
Indicated Resource (t)	280,710	18,330	61,000	149,350	509,420
Grade (g/t)	1.61	2.23	1.89	2.73	1.99
Total Gold (oz)	14,500	1,300	3,700	13,120	32,600
Inferred Resource
Total Resource (t)	1,090,000	65,470	209,340	535,330	1,900,140
Grade (g/t)	1.27	1.56	3.34	3.13	2.03
Total Gold (oz)	44,550	3,300	22,500	53,900	124,200

*Numbers are rounded. Composites capped at10.85g/tgold. Cut-off grade of 0.5g/t gold based on a gold price of US$850/oz and assumed100% metallurgical recovery .CIM definitions were followed for Mineral Resources.

 

These projects provide the Company with drill ready targets supporting its objective to increase the size and quality of the existing resource in the short term.

 

The Haneti project is the subject of a joint venture with Brazilian Votorantim Metais Participações Ltda, a member of Votorantim Group. The Rukwa and Pinewood projects are situated close to the Mtwara Corridor, an area where the Tanzanian Government has committed to significant infrastructure development and which has seen recent multi-million dollar investment in coal and coal-fired power stations and uranium exploration.

 

The Rukwa project is substantially more advanced than Kibo's existing exploration projects, with a significant Mineral Resource of thermal coal already defined. The project enjoys strong support expressed by the Tanzanian Government for the expedited development of a coal mine and mine-mouth coal-fired power plant and which is further enhanced by the now formal relationship between the Korean Government owned Korean East - West Power Co. Ltd. ("EWP")  and Kibo. In this relationship the parties have entered into a formal MOU which states the parties' respective commitments towards the joint development of the Rukwa Coal to Power Project ("RCPP"), where EWP will be responsible for developing and operating the power generation side of the RCPP and Kibo will be responsible for developing and operating the mining side of the RCPP.

 

RUKWA COAL RESOURCE SUMMARY- GEMECS (Pty) Ltd
	SEAM	NI 43-101	IN SITU
SEAM	THICKNESS	CLASS	MILLION TONS
S4	1.14	Indicated	2.17
S3U	2.04	Indicated	6.92
S3L	2.3	Indicated	12.63
S2	3.45	Indicated	23.43
S1U	2.48	Indicated	7.34
S1L	2.92	Indicated	17.4
S0	1.08	Indicated	1.44
Total Indicated Resources			71.34
S4	1.31	Inferred	1.38
S3U	2.24	Inferred	2.94
S3L	2.27	Inferred	3.86
S2	3.42	Inferred	7.94
S1U	2.05	Inferred	6.5
S1L	3.15	Inferred	12.83
S0	1.06	Inferred	2.6
Total Inferred Resources			38.05
TOTAL RESOURCES			109.39

 

 

Kibo's objective is to build shareholder value in a sustainable manner.  This objective will be pursued primarily through active exploration of its own projects and by using the Company's experience in Tanzania to acquire attractive exploration and development assets on competitive terms that can be moved swiftly up the value curve by using the Company's own skills base whilst also seeking to benefit from strategic collaborative relationships with industry leaders who have special skills and competencies within their chosen fields of focus.  Kibo will undertake continual risk assessment of its projects and take whatever actions it believes are necessary to ensure that these risks are mitigated.

 

Review by Qualified Person

 

The information in this announcement that relates to the Imweru and Lubando mineral resources is taken from reports titled "Technical Report on the Imweru property (Updated), Mwanza, Tanzania" dated March 1, 2010 and "Technical Report on the Lubando property, Mwanza, Tanzania" dated 31^st August 2009" (the "Reports") Both Reports are NI 43-101 compliant and were prepared for Great Basin Gold Rusaf Gold Limited by Nathan Eric Fier C.P.G., P.Eng. Market Director for EBA Engineering Consultants Ltd and a Senior Mining Consultant. Mr. Fier is registered as a Certified Professional Geologist with the American Institute of Professional Geologists, Registration No 10062, and a professional Engineer in British Columbia, Canada Registration No. 135165. He has extensive experience in the evaluation and reporting of Archaean Gold projects and is a "Qualified Person" for reporting gold resources to the NI 43-101 Standard.  Theinformation in this announcement that relates to the Rukwa coal resource is taken from  a report "Independent Technical Report for the Rukwa Coal Project, Mbeya Region, United Republic of Tanzania" dated 19^th April 2012 by CD van Niekerk Director and Principal Geologist with  the firm GEMECS (Pty) Ltd. Mr van Niekerk is a Professional Natural Scientist with the South African Council for Natural Scientific Professions (SACNASP), Registration No. 400066/98 and a Fellow Member of the Geological Society of South Africa. He has relevant experience and technical qualifications to be a "Qualified Person" for reporting coal resources to the NI 43-101 Standard.The Company's Exploration Director, Noel O'Keeffe has also reviewed the technical reports and the references to them in this announcement.

 

Johannesburg

8 October 2013

 

Corporate and Designated Adviser

River Group