AFRICA – Chariot Oil & Gas Ltd, the Africa-focused transitional energy company, has signed a deal to buy Africa Energy Management Platform (AEMP), a developer of renewable and hybrid energy projects with a focus on African mining sites.
Chariot has agreed to pay up to US$2 million in cash and stock for the ownership of AEMP, including a milestone payment of up to US$0.75 million. Completion of the transaction is expected to take place in the second quarter of 2021. Once this happens, the buyer will change its name to Chariot Limited.
AEMP has an existing partnership with independent power producer Total Eren, which is backed by French multinational energy company Total SE. The pair is looking to supply clean energy to operational mines in Africa and are currently in talks with local sector players with an aggregate requirement for 500 MW of power.
The two companies have already completed a hybrid power project at the Essakane gold mine in Burkina Faso. The particular complex consists of a 15-MW solar photovoltaic (PV) plant and a Heavy Fuel Oil (HFO) power facility.
Chariot said it will acquire a 10% stake in the Essakane project, while Total Eren will continue to own 90%.
“I am delighted to announce the acquisition of AEMP. We believe this move will provide Chariot with numerous further valuable, exciting and scalable projects that complement and build on our value accretive Transitional Gas project in Morocco,” Adonis Pouroulis, acting CEO of Chariot, said.
“The acquisition also plays to Chariot’s and its managements’ significant experience and other business interests within the mining sector in Africa. We are already well advanced in adding to the project pipeline and we look to forward to announcing these when appropriate.”
Chariot’s management is also looking to leverage its other significant business interests in multiple mining operations across Africa to rapidly grow the pipeline. The African mining power market is estimated to be around the same size as half of the entire UK power market.
For the Strategic Partnership with Total Eren, AEMP has a right to invest in up to 15% project equity at cost in projects developed by the Partners.
This provides multiple value accretive opportunities for re-investment of anticipated material cashflows provided by Chariot’s Transitional Gas Project, the Anchois Development in Morocco.
AEMP currently recovers its overhead costs as part of the partnership providing an immediate post-acquisition revenue stream to finance ongoing costs.
