Norway-based renewable energy firm Magnora is set to double its South African project portfolio by purchasing a 92% stake in African Green Ventures (AGV).

AGV is a renewable project development company that operates large-scale solar photovoltaic (PV) and onshore wind assets.

The company recently assumed the project rights to more than 800MW of wind and solar PV capacity after signing land lease option agreements.

Under the terms of the agreement, AGV’s management will hold the remaining 8% stake in the company.

The financial details of the transaction have not been disclosed.

Magnora Strategies’ executive vice-present Peter Nygren will also step down to become an active owner in AGV.

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The acquisition will increase Magnora’s South African portfolio from 850MW to almost 1.7GW.

The deal is also expected to create operational synergies, as AGV has been responsible for some of Magnora’s development activities in the country.

Magnora CEO Erik Sneve said: “We see great opportunities in South Africa, both in the short and long term, and we expect increased power consumption due to economic development and green electrification.

“AGV’s approach to sourcing attractive projects is complementary to our methods and capabilities, and we look forward to having them as a part of the Magnora team.”

At present, South Africa generates more than 80% of its energy from coal-fired power plants.

Magnora said the country is an ‘attractive’ region for solar and wind development as more than 35,000MW of its coal energy capacity is due to be decommissioned by 2050.

At last year’s global COP26 climate summit, South Africa entered a partnership to receive $8.5bn of funding from the US, EU and several European countries to reduce its reliance on coal.

The Just Energy Transition Partnership is expected to prevent up to 1.5 billion tonnes of emissions over the next 20 years and help expedite South Africa’s transition to a low emission, climate-resilient economy.