CIC Energy announces commencement of coal-to-hydrocarbons feasibility study


    ROAD TOWN, TORTOLA, British Virgin Islands, Dec. 12 /CNW/ - CIC Energy
Corp. ("CIC Energy" or the "Company") (TSX:ELC, BSE: CIC Energy) is pleased to
announce the commencement of both a feasibility study and a detailed market
study on a coal-to-hydrocarbons project in Botswana (the "CTH Project"), at
the Company's Mmamabula Coalfield. This follows positive results from an
internal scoping study, which indicated robust economics for the CTH Project,
which is currently 100% owned by CIC Energy.
    The CTH Project is one of the ways that CIC Energy is working to maximize
the value of the coal resource at Mmamabula, beyond the Mmamabula Energy
Project. The current Mmamabula coal resource estimate of approximately
2.3 billion tonnes, in the measured and indicated categories, exceeds
projected coal consumption for both Phase One and Phase Two power plants. In
addition, ongoing exploration is expected to lead to a further increase in the
coal resource. Please see the technical report referred to at the end of this
news release for further information on the Company's coal resource estimate.
    The Company has appointed Jacobs Engineering Group Inc. ("Jacobs") to
conduct a feasibility study to produce synthesis gas ("syngas") from coal
which can be converted to a variety of downstream products including
chemicals, gas and fuels. Completion of this feasibility study is expected in
the second quarter of 2008.
    CIC Energy also announces the appointment of Wood Mackenzie to do an
in-depth market study for the Company's CTH Project, to assess the potential
demand for the different downstream products that can be produced from syngas
including chemicals, gas and fuels. The first phase of this market study is
expected to be completed in the first quarter of 2008.
    "The appointment of Jacobs and Wood Mackenzie to conduct feasibility and
market studies is an important step toward maximizing the full value of the
large coal resource at Mmamabula," said Mr. Gregory Kinross, President of CIC

    Other Corporate News

    In other corporate news, CIC Energy is pleased to announce that the
Government of Botswana has approved the Environmental Impact Statement for all
planned transmission lines in Botswana related to the Mmamabula Energy
Project. Approximately 50 kilometres of transmission lines will be constructed
from Mmamabula to the South African border, to tie into the electrical grid
belonging to Eskom Holdings Limited, South Africa's national electrical
utility. Additional transmission lines will connect the Mmamabula Energy
Project to Botswana's electrical grid, owned and operated by Botswana Power
Corporation (BPC), which includes BPC's Morupule power station. This
environmental approval complements the approvals for the Company's power
station and mine announced on October 29, 2007.
    Furthermore, CIC Energy announces the following executive appointments.
Mr. Warren Newfield, Co-Chairman of CIC Energy and founder of Tau Capital
Corp., is appointed as CEO of the Company. Mr. Gregory Kinross will remain
    In addition, Mr. Craig McLeary has been appointed as Chief Financial
Officer, effective February 2008. At the same time, Ms. Susan Myburgh,
currently the CFO, will take on the new role of Financial Director of the
Company's South African subsidiary, CIC Energy (SA) (Pty) Limited.
    Mr. McLeary, a Chartered Accountant, brings 17 years of accounting and
finance expertise to CIC Energy, including most recently as Group Financial
Manager at Sappi Limited, a global leader in the pulp and paper industry
headquartered in Johannesburg, South Africa (NYSE, JSE, and LSE listed). Sappi
had annual sales of over US$5 billion in fiscal 2007 with manufacturing
operations on four continents, sales offices in 50 countries and customers in
over 100 countries worldwide. Mr. McLeary was a member of the Audit and
Accounting Task Group of the King Committee on Corporate Governance (King II)
in South Africa. He began his career at Deloitte & Touche, South Africa and
received a Bachelor of Commerce Degree from Natal University, as well as a
Bachelor of Accounting Science (Honours) from the University of South Africa.
    "Craig McLeary is a strong addition to CIC Energy's senior management
team and we are very pleased to have him on board," said Mr. Gregory Kinross,
President of CIC Energy.

    About CIC Energy Corp.

    CIC Energy is a TSX/BSE-listed company engaged in the advancement of the
estimated US$9.5 billion Mmamabula Energy Project, a planned power station and
integrated coal mine in Botswana. The Mmamabula Energy Project is in
partnership with International Power plc (LSE listed), a leading independent
electricity generating company. The Southern Africa region is projected to
require significant new baseload power generation capacity over the next
several years. The Mmamabula Energy Project is located in the Mmamabula Coal
Field of southeastern Botswana, 120 kilometres north of the capital city of
Gaborone and adjacent to South Africa's Waterberg Coal Field. The majority of
the electricity generated is intended for export under a long-term power
purchase agreement to South Africa's national utility, Eskom Holdings Limited.
Phase One of the Mmamabula Energy Project is planned as a 2,100 to 2,500
megawatt (MW) power plant with an integrated 7.5 to 9.0 million tonne per
annum coal mine scheduled to be in commercial operation in 2012.
    Additional information with respect to the mineral resource estimate for
Mmamabula is contained in a technical report of Snowden Mining Industry
Consultants ("Snowden") dated June 1, 2007 and entitled "CIC Energy Corp.:
Mmamabula Project, South-eastern Botswana, Project No. J912, National
Instrument 43-101 Technical Report", a copy of which has been filed on SEDAR
and may be accessed at Snowden is an international minerals
consultancy group independent of CIC Energy. The Company issued a news release
on April 18, 2007 announcing an updated mineral resource estimate for
    The global mineral resource estimate for Mmamabula now totals
approximately 2.3 billion tonnes of coal, which is comprised of approximately
1,660 million tonnes in the measured category and approximately 637 million
tonnes in the indicated category.
    Snowden has concluded that coal from the Dovedale, Serorome and Mmamabula
South Blocks is suitable for steam-producing thermal power generation, with
raw coal calorific values ("CV") of approximately 20.5 mega joules per
kilogram ("MJ/kg") for the D1 seam and 23.2 MJ/kg for the M2 seam; these
qualities compare favorably with those reported for the Mookane Block of
21.7 MJ/kg for the D1 seam and 23.1 MJ/kg for the M2 seam.
    Ms. Lesley Jeffrey is the "Qualified Person" for Mmamabula within the
meaning of NI 43-101. Ms. Jeffrey is employed by Bon-Terra, a subsidiary of
CIC Energy.
    CIC Energy has a treasury of approximately CDN$121 million.

    About Jacobs

    Jacobs (NYSE:  JCE) is one of the world's largest and most diverse
providers of professional technical services with annual revenues exceeding
US$8 billion. Jacobs has extensive experience in applying gasification to meet
the needs of various industries and has developed proprietary technology to
improve the performance of gasification plants. Jacobs also has extensive
experience in the production of chemicals and fuels produced from syngas. For
more information on Jacobs please visit

    About Wood Mackenzie:

    Wood Mackenzie has been providing a unique range of research products and
consulting services to the energy and life sciences industries globally for
over 30 years. Wood Mackenzie clients include 40 out of the top 50, energy and
pharmaceutical companies worldwide. For more information on Wood Mackenzie
please visit

    Forward-Looking Statements

    This news release contains certain "forward-looking statements". All
statements, other than statements of historical fact, that address activities,
events or developments that the Company believes, expects or anticipates will
or may occur in the future are forward-looking statements. These
forward-looking statements reflect the current expectations or beliefs of the
Company based on information currently available to the Company. Such
forward-looking statements include, among other things, statements relating to
the Mmamabula Energy Project and the CTH Project with respect to estimates
and/or assumptions in respect of mineral resources, targets, future
production, goals, objectives, plans and future economic, market and other
conditions. Forward-looking statements are subject to significant risks and
uncertainties and other factors that could cause the actual results to differ
materially from those discussed in the forward-looking statements, and even if
such actual results are realized or substantially realized, there can be no
assurance that they will have the expected consequences to, or effects on, the
Company. Factors that could cause actual results or events to differ
materially from current expectations include, but are not limited to: failure
to complete a positive bankable feasibility study on the Mmamabula Energy
Project; failure to complete, or delays in the completion of, positive
feasibility and market studies on the CTH Project; the grade, quality and
recovery of coal which is mined varying from estimates; inflation; changes in
exchange rates; the ability to raise the required debt financing for the
Mmamabula Energy Project; delays in the development of the Mmamabula Energy
Project caused by unavailability of equipment, labour or supplies, limited
capacity among engineering, procurement and construction firms, climatic
conditions or otherwise; insufficient transportation and transmission
capacity; geological and mechanical conditions; delays or failures in
obtaining regulatory permits and/or licences respecting mining, power
generation and/or power transmission lines; the existence of undetected or
unregistered interests or claims, whether in contract or tort, over the
properties of the Company; availability of water and sorbent (at cost
effective prices); inability to enter into power purchase agreements and/or
transmission agreements with Eskom Holdings Limited and (to a lesser extent)
Botswana Power Corporation or other requisite agreements, including
preliminary and/or definitive fixed price contracts with reputable
engineering, procurement and construction firm(s) and other agreements
required to facilitate the development, operation and financing of the
Mmamabula Energy Project, including with International Power plc; failure to
raise additional funds on favourable terms to finance such development;
inability to obtain tax concessions from the Government of Botswana and
requisite credit support from the Government of South Africa and/or the
Government of Botswana; political risks arising from operating in Africa; or
other factors (including development and operating risks). Any forward-looking
statement speaks only as of the date on which it is made and, except as may be
required by applicable securities laws, the Company disclaims any intent or
obligation to update any forward-looking statement, whether as a result of new
information, future events or results or otherwise. Although the Company
believes that the assumptions inherent in the forward-looking statements are
reasonable, forward-looking statements are not guarantees of future
performance and accordingly undue reliance should not be put on such
statements due to the inherent uncertainty therein.
    Mineral resources that are mineral reserves do not have demonstrated
economic viability.

    %SEDAR: 00023467E

For further information:

For further information: on the Company and the Mmamabula Energy
Project, please visit CIC Energy's website at or contact:
Erica Belling, CFA, P.Eng., VP Investor Relations, Tau Capital Corp., Tel:
(416) 361-9636 x 243, Email:

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