Mbeya Coal-to-Power project development in Tanzania remains uncertain after years of limited progress and a major ownership change. The proposed development combines coal mining with a mine-mouth thermal power station in Mbeya. However, no confirmed construction activity or financial close has emerged as of 2026. Kibo Energy disclosed that it disposed of its holdings in the project during September 2024.
The project originally targeted a 300MW coal-fired power station alongside a dedicated coal mine. Earlier studies also identified potential expansion toward 1,000MW.
Construction Review Online previously reported that Tanzania Electric Supply Company (TANESCO) gave the project a development greenlight in 2019. That decision allowed Kibo to explore export, utility and private power markets. However, the project’s position has changed substantially since that announcement.
Mbeya Coal-to-Power Project remains stalled
The Mbeya Coal-to-Power Project originally formed a major part of Kibo’s Tanzanian energy portfolio. The development integrated a coal mine with a mine-mouth thermal power plant.
The proposed mine contained a defined 120.8 million-tonne thermal coal resource. Meanwhile, the power station targeted 300MW through two 150MW generating units.
The project design also allowed future expansion toward 1,000MW. Its feasibility work targeted annual electricity generation of about 1,840GWh.
However, the development encountered difficulties securing a power purchase agreement. Kibo’s 2022 annual report also highlighted commercial challenges surrounding the coal resource.
The company cited coal quality, the site’s remote location and limited transport infrastructure. It also identified high transportation costs and weak market economics as major constraints.
In addition, Kibo reported that the project had made no significant progress. The company subsequently valued the project at nil in its financial statements.
Kibo then disposed of its interest in the project during September 2024. Therefore, the company no longer provides a clear development route for the original project.
As of 2026, there is no confirmed evidence of construction commencement or financial close. There is also no publicly confirmed replacement developer or EPC contractor.
The project’s earlier approval therefore remains a historical milestone rather than evidence of an active construction programme.
Mbeya Coal-to-Power Project cost and development outlook
Earlier feasibility work estimated the thermal power station’s cost between $640 million and $760 million. The final figure depended on the selected plant configuration.
Those figures represent historical estimates rather than a current project budget. No updated 2026 investment value has been announced following the ownership change.
The mining component also required substantial supporting infrastructure. Earlier plans identified a funding requirement of about $17 million for the standalone coal mine.
The proposed mining operation could produce approximately 1.5 million tonnes of coal annually. The power plant would provide the principal market for that output.
Earlier development plans involved SEPCO III as the proposed engineering, procurement and construction contractor. General Electric also featured as an equipment, technology and services partner.
However, those historical arrangements should not be treated as current appointments. The ownership transition means a future developer would need to reassess the project structure.
Tanzania continues to pursue additional power-generation capacity despite the uncertainty surrounding Mbeya. The country also remains interested in coal-based generation alongside other energy sources.
For instance, the proposed 2,000MW Dangote Coal-fired Power Plant forms part of a wider industrial investment program under discussion in Tanzania.
The development could complement Tanzania’s existing coal-to-power pipeline while supporting industrial electricity demand.
Also Read:300MW Kam’mwamba coal-fired power project in Malawi underway
Mbeya coal-to-power project
According to feasibility studies done, the project has a potential to generate 100MW of power. Tanesco implemented the power interconnectors through Zambia, Tanzania and Kenya, enabling power trade among the Eastern African Power Pool and the Southern African PowePool member countries.
Additionally Kibo was asked to engage the power pools to ensure participation in the high demand export market. The notice from Tanesco was however not subject to any tender process. It is unrelated to the tender refereed in February.
“Our recent engagement with TANESCO shows our belief in MCPP which continues to have significant economic importance for not only Tanzania but the region too. I’m looking forward to updating shareholders on the details and progress of MCCP,” said Kibo CEO Louis Coetzee.
Project fact sheet
Project name: Mbeya Coal-to-Power Project (MCPP)
Type: Integrated coal mining and thermal power development
Location: Mbeya Region, Tanzania
Original power capacity: 300MW
Original configuration: Two 150MW generating units
Expansion potential: Up to 1,000MW
Power technology: Mine-mouth coal-fired thermal generation
Coal resource: Approximately 120.8 million tones
Planned coal production: Approximately 1.5 million tones annually
Historical power project cost: $640 million to $760 million
Historical mine funding requirement: Approximately $17 million
Expected annual generation: Approximately 1,840GWh
Original developer: Kibo Energy PLC and associated Tanzanian project companies
Government power partner: Tanzania Electric Supply Company (TANESCO)
2019 milestone: TANESCO provided a development greenlight for export-market engagement
Power markets: Export, utility and private offtake markets
2022 mining licences: Seven mining licences formed part of the proposed coal development
2024 ownership change: Kibo disposed of its holdings in the project
2026 status: No confirmed construction, financial close or replacement developer
Project team
Former project developer: Kibo Energy PLC
Tanzanian project entities: Mbeya Coal Ltd and Mbeya Power Ltd
Government power counterpart: Tanzania Electric Supply Company (TANESCO)
Former EPC partner: SEPCO III
Former technology and equipment partner: General Electric (GE)
Engineering and feasibility consultant: Aurecon
Former financial adviser: Standard Bank
Mining component: Mbeya Coal Ltd
Power generation component: Mbeya Power Ltd
Former government regulator: Tanzania Ministry of Energy and Minerals
Mining regulator: Tanzania Mining Commission
Water regulator: Lake Rukwa Water Basin Board
Historical offtaker discussions: TANESCO
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