Intra Energy Corporation, an Australian-based mining and energy company with major thermal coal assets in Tanzania, has acquired coal licences for an operational mine in Malawi as well as exploration licences for further sites. In December 2012, the Malawian Minister of Mining, John Bande MP, confirmed the government was processing an application for the company,
We have an application from Intra Energy and it is being processed like any other application. We will announce what will transpire. Generally, we have resolved to be very careful. As government, we shall protect investors and also the communities where these mines will be located.
Intra Energy has already established offices in Lilongwe and a joint venture company with Consolidated Mining Industries, its local partner. The joint venture company is Malcoal (Malawi Coal Company). Intra Energy has 90% interest and Consolidated Mining Industries has 10% free carried interest. IEC maintains all management and operating rights.
Intra Energy’s Chairman, Graeme Robertson, discussed the company’s activities in Malawi
According to the World Bank, only 8 per cent of Malawi’s population of approximately 16 million people has access to electricity. Malawi’s total demand for power currently stands at 300 megawatts (MW), resulting in a generation shortfall. This shortfall is projected to grow rapidly and the Malawi Ministry of Energy estimates that the country will need 603 MW by 2015 and 829 MW by 2020.
The granting of the coal mining and exploration leases in Malawi allows the development of an international standard coal mine to supply existing industrial markets and support coal-fired electricity generation in the country. Not only does this enhance IEC’s role as the major regional coal supplier in Eastern Africa it also provides the base for what is needed to support growth and prosperity in Malawi - jobs and electricity generation
The EPLs were granted to Consolidated Mining Industries, acquired by Intra Energy for USD 800,000 and a loan of USD 150,000 to Consolidated Mining Industries. They cover a combined area of 84.7 square kilometres and the mining licence covers an area of 2 square kilometres. These EPLs and ML have been transferred to Malcoal.
- EPL 0174/2005 granted on 22 September 2005 over an area of 37.5 sqkm at Mwenewenya
- EPL 0209/2007 granted on 27 June 2007 over an area of 12.2 sqkm at Mwapu
- EPL 0163/2005 granted on 7th July 2005 over an area of 35 sqkm at Livingstonia
- The EPLs were renewed on the 15th June 2012
- The Mining Licence ML0143/2005 was granted on 30th December 2005 for fifteen years, covering an area of 2 square kilometres (Nkhachira Coal Mine), immediately adjacent to EPL 0174.
Geological mapping and exploration drilling were carried out as part of due diligence last year. In this quarter, Intra Energy will expand the operational mine and mechanised mining operations will commence. A contract mining arrangement has already been negotiated local quarry contractor.
Expensive preparation is not necessary for the coal and it will be delivered to consumers in the region by road and possibly by barge. Currently, most of Malawi’s coal is exported to Tanzania.
There are also reports that Intra Energy will set up a 200 mega watt thermal power generation plant in the central region and another in Karonga as the national grid is unlikely to be able to meet the demand of the mining operations.
The company’s most recent Quarterly Activities Report, for the period ending 31 December 2012, is available online.