JSE-listed copper producer Copper 360 has concluded an agreement with Mulilo Renewable Project Developments to acquire 100% of Mulilo Springbok Wind Power (MSWP).

MSWP is the owner of a project to establish a 55 MW wind energy generation facility in the Springbok area, in the Northern Cape province. The project is at an advanced stage with regard to feasibility studies, technical documentation and engineering plans.

Copper 360 said on January 22 that an attractive feature of the project was its fully authorised environmental-impact assessments and other relevant clearances, permits and land leases that were already in place.

Studies indicate that the intended location of the generation facility is favourable in terms of wind profiles.

The purchase consideration comprises an initial cash payment of R5-million, with deferred cash payments of R1-million per megawatt of installed capacity, payable as capacity is installed.

The company said there were no conditions precedent and that the acquisition was therefore expected to be completed during the first week of February.

Copper 360 said it had a strategic objective to achieve energy security as it grew its core copper-producing business through its cluster mining model, and to do so in an environmentally responsible manner using renewable energy.

The acquisition will provide the company with a platform to generate renewable power to meet the increasing energy needs of the copper-producing business in a cost-effective manner.

To this end, Copper 360 has started investigating a wider renewable energy supply strategy, of which wind energy generation will be an important component. This investigation will, among other things, include an assessment of whether to exercise its right to participate in the energy supply business or to outsource energy production to a greater or complete extent with due consideration of its focus on its core objective, which is to grow its copper business.

"The pursuit of energy security for Copper 360's growing business in the form of reliable and responsible renewable power generation is a key strategic objective. The acquisition aligns with Copper 360's objective to grow through the development of its cluster mining model, whilst reducing our carbon footprint in our quest for net-zero targets.

“We believe there are not only strategic and environmental benefits but, as importantly, also energy cost benefits that Copper 360 will be able to achieve,” Copper 360 CEO Shirley Hayes said.

Copper 360’s share price on the JSE rose by nearly 6% on the news.