The company that is engaged in the advancement of the Mmamabula Energy Project, CIC Energy Corp, said this week that it might require additional Environmental Impact Assessment (EIA) studies in line with project optimization. The first round of feedback into the EIA draft that was submitted to government at the beginning of February this year ends tomorrow. The draft copy was submitted to government for review and comment, with the public review window open for a period lasting 21 days to April 6, 2007. Responding to The Sunday Standard, the company said it is on schedule but warned that ‘project optimization may require that additional studies are undertaken with these feeding back into the main document.’
There were fears at the beginning of the year that the Mmamabula Energy Project might not meet the deadline due to delays. On paper, the draft EIA was scheduled to be submitted to government in January this year but delayed. Next month, the company is to submit International Environmental and Social Impact Assessment (ESIA) to government and make it available to the public.
“On current planning, the ESIA is to be completed by June of this year,” the company promised.
Both the ESIA and EIA have been subcontracted to South African companies in Environmental Resource Management (ERM) and Digby Wells and Associates (DWA) whose contract ran for 12 months to June this year. The environmental studies are part of the requirements of the government’s Environmental Conservation Act and International Environment and Social Standards. Defending the appointment of the duo, CIC Energy Corp said the two companies’ reputation and competence are unquestionable.
“The two consultants were chosen as they are both leaders in their fields, not only in South Africa but continent wide.”
ERM, the company said, is one of the largest and most respected environmental management consultancy firms in the world.
“Having ERM consult for the project ensures we meet the lender’s requirements of having an international consultancy firm involved in our environmental and social studies,” the company said.
CIC Energy Corp further confirmed the acquisition of another Johannesburg based consulting firm, Southern African Development through Electricity (Pty) Ltd. (SAD-ELEC) via a binding Sale of Business Agreement. Commercial terms of the agreement included a cash payment of R6.5 million (approximately P5.5 million) and the issuance of 130,000 common shares and 100,000 common share purchase warrants of CIC.┬á Each warrant will entitle the holder to purchase one common share of CIC at CDN$11.00 until January 1, 2009.
SAD-ELEC is a leading consultancy group in the Southern African energy sector, with extensive experience in providing energy-related advisory services to utilities, governments, major energy consumers, fuel suppliers and financiers.┬á SAD-ELEC has served as a strategic advisor to CIC since August, 2005, focusing on legal, regulatory and utility issues, power market analysis, commercial arrangements, and transmission integration for the Mmamabula Energy Project into the Botswana and South African power grids.
Dale Ter Haar, Head of the Botswana office said a wholly-owned subsidiary of CIC has agreed to purchase SAD-ELEC’s “Core Business”, effective January 1st this year.┬á This includes SAD-ELEC’s consulting, advisory and management business, along with the services of certain senior executives, including Tore Horvei, Mike Page, Stefan Regardh, Les K├╝gel and Cosmas Gutu.
“The senior executives will be managing key aspects of Mmamabula, in particular related to the planned implementation and operations phases. The expertise and experience that SAD-ELEC brings to the project will be key in the managing of important aspects of the Mmamabula Energy Project,” he said. The Botswana head conceded that the timing of the purchase of SAD-ELEC was largely influence by the mammoth task ahead of them in Mmamabula Project.
“The timing of the purchase of SAD-ELEC was predominantly influenced by the Mmamabula Energy Project but SAD-ELEC’s expertise will clearly provide significant value for any future projects,” he added.
Projecting the overall economic contribution of the project, the company said its estimate show that Gross Domestic Product (GDP) would increase by seven percent during the first phase of the project and further seven percent during the second phase.
CIC Energy Corp. ÔÇô a TSX/BSE listed outfit is tasked with feeding the Southern African region with power in the face of projected shortage after 2010. The region is projected to require significant new base-load power generation capacity beginning in 2011.