The board of Syrah Resources Limited (Syrah) has announced its approval to finance a hybrid solar and battery power system at its Balama graphite operation in Mozambique, taking advantage of the high potential for solar irradiation of the site location.
Syrah Resources has selected an 11.25 MWp solar photovoltaic (PV) installation combined with an 8.5 MW/MWh battery energy storage system to be integrated with the existing Balama diesel power plant. Extensive due diligence was undertaken on the selection of equipment and suppliers of solar PV modules, battery energy storage technology and hybrid control system.
Currently, Balama is only powered by a 15 MW diesel-generating power plant, 100% owned and operated by Syrah. This system was initially selected as a low-risk feeding option for the development of Balama. However, grid electricity is not currently available for Balama’s power needs due to a lack of nearby high voltage transmission infrastructure.
Therefore, following the signing of a Memorandum of Understanding with Solar Century Africa Limited in December 2020, Syrah and Solarcentury Africa have completed the design, detailed engineering and secured, structured and arranged financing for a system solar batteries.
On average, the solar battery system will provide approximately 35% of the energy needs of the Balama site, resulting in a reduction of approximately 35% in diesel consumption for power generation. During peak hours, the solar battery system will be able to supply up to 100% of Balama’s energy needs.
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CrossBoundary Energy (CBE) provided the financing for the project, which will be carried out under a build-own-operate-transfer (“BOOT”) agreement, comprising a 10-year operating lease and a operation and maintenance with a project incorporated in Mozambique company 100% owned by CBE. This project company will build, own and operate the solar battery system for the duration of the BOOT.
The operations and ownership of the solar battery system will be transferred to Syrah at no cost at the end of the 10-year BOOT period. Solarcentury Africa will continue to work closely with Syrah and CBE during the construction, delivery and installation of the solar battery system and into commercial operation, which is expected to be commissioned and operational before the end of this month. March 2023.
Syrah Managing Director and CEO Shaun Verner said the installation of a large-scale hybrid solar and battery power system is expected to reduce operating costs at Balama and further strengthen the ESG credentials of Syrah’s products. natural graphite from the mine. “This project represents a first step in reducing the global warming potential of Balama and Vidalia’s active anode material plant in Louisiana, USA.”
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The solar battery system is expected to generate C1 cost savings of approximately $8 per ton at a production rate of 15 kt per month, which is factored into the Balama C1 (FOB Nacala) cash cost forecast of $430-$470 per tonne at a production rate of 15 kt per month. The project is expected to generate an attractive return on investment due to low initial investment costs, fixed costs payable by Syrah under the 10-year BOOT agreement and significant cost savings resulting from reduced consumption of diesel.
The solar battery system will reduce the global warming potential or produce carbon equivalent emissions of natural graphite Balama products. Syrah’s independent life cycle assessment estimated that the solar battery system would reduce the global warming potential of natural graphite production from the Balama mine and its transport to the port of Nacala by 0.48 kg to 0.42 kg of CO2 equivalent per 1 kg of natural graphite, which represents a reduction of 12.5%. The solar battery system is estimated to reduce Balama’s global warming potential by 18 kt CO2 equivalent per year, on average, over the life of the operation.
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