Riversdale chairman and CEO Michael O’Keeffe said that the proposed 300MW power station is ideally placed to service the increasing demand for power and would help overcome some of the supply issues governments and industry in the region are currently facing.

“We see significant opportunities for our coal project in Mozambique, not only for coking coal exports, but also for the thermal coal to be an integral component of the power generation sector in the years ahead,” O’Keeffe said.

“This includes local demand, but will also involve supplying the increasing needs of the South African economy.

“As part of this process, we will be commencing discussions with infrastructure providers in the energy sector in relation to the establishment and operation of the power station.”

Elgas was formed to explore energy opportunities in Mozambique and includes Eskom Enterprises, Electricidade de Mozambique (EDM), Empresa Nacional de Hidrocarbonetos de Mozambique, African Legend and Consultinvest.

O’Keeffe said Riversdale’s relationship with major South African utility business Eskom Enterprises, through Elgas, would also position the company well for future developments in South Africa.

Riversdale acquired coal tenements in the Lower Zambezi Coal Basin of Mozambique in October 2006, and has since carried out an intensive exploration program with a view to fast-track development of sustainable long-life mining operations.