Power Supply Assessment

When the Project previously operated (2009 to 2014), power was generated by diesel generators, which were the only reliable energy source available at that time. Estimated power costs are ~US$0.28 – $0.32/kWh based on the current diesel price, with power accounting for ~15% of the C1 costs when the plant was operating.

The Company has assessed multiple new options for power supply that were not previously available, including:

  • Connecting to the national grid
  • Generating power from excess heat generated in the onsite acid plant (estimated at 2MW)
  • Renewable options, including solar and hydro
  • Replacement of the existing diesel gensets with a Build-Own-Operate (BOO) contract arrangement

While connecting to the national grid poses a risk in relation to sustained reliability of supply, it could potentially provide the lowest cost option with power unit charge rates ranging from US$0.06/kWh during off-peak, up to US$0.18/kWh for on-peak (a weighted average daily cost is US$0.10/kWh).

Accordingly, the Company expects the optional power solution will incorporate a combination of power supply options, which together, have the capacity to significantly reduce power costs and CO2 emissions.

Discussions are ongoing with ESCOM, the Malawian electricity supply company, and a Malawian electrical power consultant has been contracted to undertake an assessment of availability and capital and operating costs for connecting to the grid either at the nearby town of Karonga (~50km from Kayelekera) or other potential substations in close proximity to Kayelekera.

Metso Outotec is preparing the study for recovering energy via a steam turbine from the acid plant and solar providers have been requested to send proposals for various solar options.

The Company is currently completing a detailed power assessment study that will be part of the DFS. This assessment will consider both the cost implications and the carbon emissions for the Project.