Sese Joint Venture Agreement
The key terms of the Joint Venture Agreement with First Quantum Minerals Ltd are as follows:
- FQM have purchased a initial 51% stake in African Energy Holdings SRL (AFRH) for $8m and will become project manager for the Sese Project.
- FQM will invest a further $12m within 18 months to earn an additional 24% stake in AFRH.
- The $12m funding for AFRH will be used to immediately investigate the development of power generation projects at Sese.
- Once FQM has earned its 75% stake, AFR’s 25% interest will be funded by FQM and loan carried through to the start of commercial operations.
- AFR’s 25% carried interest will be financed under the same terms as FQM’s majority stake with FQM to arrange the full financing for each project.
- AFR is in a strong cash position with no debt, and a 25% carried interest in new power projects being developed at Sese.
- AFR retains 100% ownership of the Mmamabula West and Mmamantswe coal and power projects in Botswana.