NextSource Materials Inc. (TSX:NEXT)(OTCQB:NSRCF) («NextSource» or the «Company») announces it has awarded a power supply contract to independent power producer CrossBoundary Energy («CBE») for the long-term supply of solar and thermal generation to power the operations of its Molo graphite mine in Madagascar. The contract is for a 20-year term and has been designed to scale with the production output of the Molo mine, where delivery of power will increase in lockstep with all future expansion capacity requirements.
A subsidiary of CBE in Madagascar is developing the project and will build, own, and operate the Molo hybrid energy power plant («hybrid plant») at no capital cost to NextSource. It will be located adjacent to the Molo mine site and is expected to be operational at the same time as the Molo mine is expected to commission in Q2 of 2022. Through this contract, NextSource will initially be able to source up to one third of the Molo mine’s total electricity needs from renewable solar energy. NextSource and CBE are committed to optimizing the solar component throughout the contract to increase the percentage of renewable energy to a majority.
The renewable energy services provided by CBE will be supplied exclusively to NextSource and provide guaranteed energy cost savings. This rate will lower expected energy costs on a per kWh basis versus the expected cost per kWh rate based on thermal power alone, as modeled in the Company’s 2019 Molo Feasibility Study.
The hybrid plant will contribute significantly towards NextSource’s adherence to its environmental, social, and governance principles. It will also achieve the Company’s broader initiative to reduce its environmental footprint through the deployment of renewable energy infrastructure to reduce emissions and work toward its goal of a carbon neutral energy system.
«We are pleased to select CrossBoundary Energy to supply hybrid power for our Molo graphite mine, which delivers on our commitment to reduce emissions and move towards more sustainable operations,» said NextSource President & CEO Craig Scherba. «Deployment of clean, renewable and sustainable power sources to reduce emissions is a cornerstone of our operational strategy and will reduce our expected energy costs over the life of our project.»
The hybrid energy power plant will comprise a 2.5MW solar PV energy system (solar plant), a 1MWh battery energy storage system (BESS) and a 3.3MW thermal energy system (diesel generators) that will supply all the electricity requirements for the Molo mine and processing plant. The thermal energy system will be used in combination with the solar plant and BESS to provide uninterrupted power supply and ensure 100% power availability to the mine.
Matthew Fredericks, Head of Mining at CrossBoundary Energy stated, «We worked closely with the NextSource Materials team to design a custom solar hybrid solution for the Molo graphite facility. This power system will reduce the mine’s total cost of electricity, lowering its all-in sustaining costs, as well as minimizing its carbon emissions. CBE is proud to be awarded this second project opportunity in Madagascar and honoured for NextSource Materials’ selection of our flexible, collaborative approach to sustainable energy solutions for African mines.»
CrossBoundary Energy is Africa’s leading supplier of clean electricity for businesses. CBE has a proven track record delivering complex commercial-industrial power solutions across Africa for corporates including Unilever, Diageo, Heineken, and Actis. Earlier this year, the company announced two additional hybrid renewable energy projects, the first for Rio Tinto’s QMM ilmenite operation in Madagascar, and the second for Eramet’s mineral sands mine, Grande Cote Operations (GCO), in Senegal. In total, CBE is now delivering 40MW of solar and wind generation and 20MWh of battery energy storage capacity for African mines.
CrossBoundary Energy was launched by the CrossBoundary Group in 2015 as Sub-Saharan Africa’s first provider of fully financed commercial-industrial solar solutions.
It currently operates in over 10 African countries and has a portfolio of over $100M of renewable energy infrastructure projects across the continent. CBE’s customers include leading local manufacturers and multinational corporates such as Diageo, Eramet, Heineken, Rio Tinto, and Unilever.
CrossBoundary Energy is funded by ARCH Emerging Markets Partners’ Africa Renewable Power Fund (ARCH ARPF).