Oil and gas exploration company, Invictus Energy has entered into a non-binding memorandum of understanding with a local firm Tatanga Energy, to investigate the commercial viability of supplying natural gas from its Muzarabani project to a proposed 500 megawatt power plant.
Invictus is currently exploring for oil and gas at its Muzarabani prospect in the Cabora Bassa Basin.
The Australia Stock Exchange-listed firm recently raised A$1.5 million Australian dollars to fund further exploration activities on the project which has shown huge potential of gas and oil deposits.
In a statement, Invictus said the supply agreement with Tatanga was for 20 years from the date of first commercial gas production.
“The Cabora Bassa Project partners, comprising Invictus (80 percent) and One-Gas Resources (20 percent) have entered into a non-binding memorandum of understanding with Tatanga Energy to progress gas supply for a 500 megawatt gas to power plant in the event of a commercial gas discovery from special grant 4571 in Muzarabani,” the company said.
“Under the MoU, Invictus and Tatanga have agreed to jointly work together and cooperate with regards to investigating the economic and commercial viability of supplying natural gas from Cabora Bassa to the proposed gas to power plant which will be sold to the national grid and or to captive clients in Zimbabwe, Zambia and Mozambique.”
Invictus said the proposed power plant will be built in two phases, with the first phase bringing on stream 150 megawatts while the second phase would bring in 350 megawatts.
The location of the power plant, Invictus said, would be determined by factors including the proposed pipeline route and access to transmission infrastructure.
“Preliminary studies have identified a number of suitable locations that provide the ability to supply electricity to the local grid as well as export customers through the Southern Africa Power Pool,” the company said.
Invictus managing director, Scott Macmillan said under the agreement, the potential gas supply per day was 100 million cubic feet and 730 billion cubic feet over 20 years.
“Signing this MoU with Tatanga Energy to develop a 500 megawatt gas to power project is another significant step forward in our commercial negotiations as we look to progress the Cabora Bassa project. Zimbabwe and Southern Africa is in the midst of an energy crisis with the region enduring acute energy shortages which is hampering industry and economic growth,” he said.
“Although the off-take volume of up to 730 billion cubic feet is substantial, it represents only about 8 percent of the independently estimated 9.25 trillion cubic feet resource potential of the Cabora Bassa project and enables Invictus to target additional markets not only locally but also in the wider region.”
Tatanga chief executive officer, Tunde Arekele said the power project supported Zimbabwe’s vision 2030.
“Invictus’ high prospectivity Cabora Bassa project in Muzarabani could potentially play a transformational role in the development of the Zimbabwean economy, fostering new industries and providing the feed-stock for the generation of much needed predictable and affordable energy for the national grid,” he said.
According to its website, Tatanga Energy was established in 2016 and is registered and incorporated under Zimbabwe’s laws by a group of seasoned finance and energy practitioners.
The company develops and operates renewable energy projects in sub-Saharan Africa and is currently developing two solar projects in Zimbabwe.
Its flagship project is a 400 MW solar photovoltaic park that is being developed in collaboration with Masawara Limited and Sable Chemicals Limited.
The first 50 MW phase of this project is expected to produce energy for the national grid by 2021.