Mulilo has resolved a significant land-use overlap affecting its planned Newcastle Wind Energy Facility after concluding a co-operation agreement with Australian-listed gas developer Kinetiko Energy.
Announced by Kinetiko Energy on Wednesday, 19 August 2026, the agreement involves its wholly owned South African subsidiary, Afro Energy, which holds Exploration Right ER270 over an area overlapping portions of the proposed Newcastle wind project.
Under the Co-operation and Settlement Agreement, Mulilo Newcastle Wind Power (MNWP) has secured exclusive use of a defined 18.54km² exclusion zone along the eastern boundary of ER270.
In return, Afro Energy will receive A$1,260,720 in cash consideration, paid in the rand equivalent.
According to Kinetiko, the agreement resolves the overlapping land use and provides certainty that its exploration programme can continue up to the boundaries of the defined exclusion zone, while allowing the Newcastle Wind Energy Facility and associated grid infrastructure to proceed without interference.
Importantly, the affected 18.54km² represents approximately 1.1% of Kinetiko’s Exploration Right ER270, with the company retaining its exploration and related rights outside the defined area, including the ability to renew or convert the Exploration Right.
Furthermore, the agreement also introduces another potential commercial opportunity for Kinetiko.
Afro Energy has secured a right of first refusal to supply natural gas should Mulilo or MNWP procure gas-fired electricity generation in connection with the Newcastle project.
However, Kinetiko stressed that the agreement does not oblige Mulilo or MNWP to procure gas.
Regarding the payment structure, the co-operation fee will be paid in two tranches.
An initial non-refundable payment of 20% is due following execution of the agreement, while the balance becomes payable once the wind project reaches financial close.
Kinetiko stated, “Afro Energy will receive the Rand equivalent of A$1,260,720 in cash consideration. An initial non refundable payment of 20% is due following execution of the Agreement, with the balance payable following Financial Close of the MNWP targeted for 31 December 2026.”
This latest financial-close date is particularly noteworthy.
As previously reported by Newcastillian News in July 2026, Mulilo indicated at the time that financial close for the Newcastle Wind Energy Facility was anticipated during August 2026, after which construction was expected to commence and continue for approximately 24 months.
To read Newcastillian News’ previous report on the Newcastle Wind Energy Facility, click here.
Kinetiko’s newly released announcement, however, now refers to financial close being targeted for 31 December 2026.
It is currently unclear whether the December date represents a revised project timetable, a contractual deadline specific to the Kinetiko agreement, or another adjustment to the project’s financial-close process.
As previously reported, the Newcastle Wind Energy Facility is planned approximately 15km northwest of Newcastle and is expected to consist of 33 Envision Energy turbines, each rated at 8MW.
The development is expected to deliver a capacity of 264MWDC, or 240MWAC, with electricity generated at the facility feeding into the Eskom grid through the Incandu Main Transmission Substation.
A roughly 23km, 132kV overhead powerline is planned to connect the wind development to the transmission infrastructure.
Mulilo previously confirmed that a 20-year power purchase agreement is to be concluded with a private off-taker and that the project does not form part of South Africa’s Renewable Energy Independent Power Producer Procurement Programme.
The project had also already secured several significant approvals when Newcastillian News spoke to Mulilo in July.
Environmental Authorisation was granted by the Department of Forestry, Fisheries and the Environment on 4 October 2024, Civil Aviation Authority approval was received on 20 February 2026, while SPLUMA approval was obtained on 17 June 2025.
In addition, Mulilo indicated at the time that additional municipal permits and approvals were being concluded as the development moved towards financial close.
For Kinetiko, meanwhile, the agreement delivers more than the resolution of an overlapping land-use area.
The company said the A$1.26 million co-operation fee is non-dilutive funding and will be applied towards accelerating its Phase 1 gas production cluster at Brakfontein.
Kinetiko has also indicated that it is in discussions with other renewable energy developers regarding similar land-access arrangements.
The latest agreement therefore establishes a defined physical boundary between two different energy developments operating within the same broader area.
Rather than one project displacing the other entirely, Afro Energy retains its exploration rights across the remainder of ER270, while Mulilo gains exclusive use of the 18.54km² area required for the Newcastle wind project.
At the same time, the difference between Mulilo’s previously stated August 2026 financial-close expectation and Kinetiko’s newly published 31 December 2026 target introduces a fresh question around the project’s timetable.
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For now, however, the agreement confirms that the identified land-use overlap between the proposed wind facility and Afro Energy’s Exploration Right has been resolved, allowing both projects to proceed within clearly defined boundaries.
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Whilst here, be sure to read: Lions Bay Energy’s R200m Newcastle Project Aims to Revive Karbochem Industrial Park
