Shares in Mast Energy Developments soared by over 50% on Thursday after it agreed to a joint venture to create a 50 megawatt portfolio of gas peaker plants.

MED is a London-based developer of reserve power generations plants and a subsidiary of Kibo Energy PLC, a Galway, Ireland-based company that develops power projects in Africa and UK.

Shares in MED were 50% higher at 1.32 pence on Thursday in London. Shares in Kibo were up 11% at 0.072 pence. In Johannesburg, Kibo shares were flat at R 0.03.

Mast Energy Developments said it has agreed to the joint venture with a new institutional investor-led consortium. The institutional investor will inject all required investment capital with an expected total investment value of about £33.6 million and will hold 75% of the joint venture, with MED holding the other 25%.

MED said the joint venture will create a portfolio of gas peaker plants with a combined total generation output of about 50MW. MED will construct and/or acquire and develop the plants within the next 12 months, and will receive a 25% free stake in the assets if it can provide the required projects.

MED expects the joint venture to be completed and executed in mid-June.

‘’We are very pleased to have signed a [heads of terms] with regards to the JV deal and excited to conclude the JV agreement in due course...The JV deal has been long in the making and follows a robust initial due diligence and negotiation process,‘ commented Pieter Krugel, MED’s chief executive officer.

‘The willingness of the institutional investor-led consortium to enter into the HoT with MED is testament of their confidence in the company’s strategy and long-term development plans to deliver flexible energy projects that are commercially viable.’

At the same time MED announced its appointment of Novum Securities Ltd as its sole corporate broker, replacing Clear Capital Markets Ltd with immediate effect. It also has agreed to a reprofiling of the outstanding balances on its existing loan facilities. The current aggregate outstanding balance is £729,750.

Kibo meanwhile noted renewed commitments via a memorandum of understanding by all parties involved in its Mbeya power project, a 1,000 megawatt coal-fired power project in Tanzania.

Copyright 2023 Alliance News Ltd. All Rights Reserved.