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Wind farm will evacuate power to Sibanye’s mines via a wheeling arrangement.

Investment & Finance

89MW wind farm to power Sibanye’s mines reaches financial close

The wind farm will be located near the town of De Aar in the Northern Cape province of South Africa.

A consortium led by African Infrastructure Investment Managers (AIIM), via its renewable energy project development and delivery platform, African Clean Energy Developments (ACED), and Reatile Renewables (Pty) Ltd has announced the achievement of financial close on 89MW Castle Wind Farm, which will supply renewable energy to Sibanye-Stillwater’s South African mining operations.

The wind farm will be located near the town of De Aar in the Northern Cape province of South Africa, and will evacuate power to Sibanye’s mines via Eskom’s transmission infrastructure through wheeling.

“ACED is pleased to have reached Financial Close on Castle for Sibanye-Stillwater and must thank and congratulate all those involved at Sibanye-Stillwater, AIIM, Reatile, and our lenders, RMB,” said James Cumming, General Manager at ACED.

“It takes a huge effort to conclude these transactions and thanks must also go to our advisers on the project. We now look forward to reaching commercial operation, all the while bringing more renewable energy projects to life over the short term and beyond, which the country is obviously in urgent need of,” adds Cumming.

Complementing Sibanye’s decarbonisation agenda

The project, according to ACED, will result in energy cost savings, increased energy security and decarbonisation benefits for Sibanye-Stillwater, a multinational mining and metals processing group. The addition of increased power generation capacity to the national grid will contribute to offsetting the power deficit currently being experienced in the country.

Sibanye’s CEO Neal Froneman said, “This marks our first major step in delivering over 550 MW of our renewable project portfolio and is a significant milestone in our journey to carbon neutrality by 2040. 

“The project will not only play a pivotal role in reducing carbon emissions and mitigating climate change but also results in cost savings on electricity and provides energy security benefits for Sibanye-Stillwater’s SA operations. Additionally, it will also contribute to addressing the electricity challenges in South Africa. We look forward to bringing the project into operation,” added Froneman.

This transaction will be the second private wind power wheeling project in South Africa to have reached financial close. 

Sechaba Selemela, Investment Principal at AIIM, noted that “the transaction was another step towards greater reliance on renewable energy and solving South Africa’s energy crisis”. Selemela added that, “with this transaction, which follows on a similar wind farm development Msenge Emoyeni reaching financial close in March, AIIM continues to be committed to, and successfully executing, its mandate of investing in renewable energy projects that can deliver strong returns for our investors and make an impact over the long term.” 

AIIM is a division of Old Mutual Alternative Investments (OMAI) and has invested in the project through the IDEAS Managed Fund, one of South Africa’s largest domestic infrastructure equity funds which invests in the SADC region’s economic, social, and energy infrastructure. ACED is a renewable energy developer and asset originator within the AIIM stable.

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