African Energy Resources Limited, the Australian┬á Stock Exchange-quoted entity pledged to embark on a massive┬á┬áexercise aimed at determining the┬á full value┬á of its coal resource┬á and the possible size of┬á power station for Botswana operations.
In a statement to the Australian Stock Exchange on Monday, it said it is committed to┬áthe “collection of a bulk sampling”┬áexercise of close to 10,000 tonnes of coal with a view of an open-pit┬ámine in mind.
The aggressive┬ámove by the company is powered by┬áa┬áconvertible US $ 5 million loan facility that it┬á got from Macquarie Bank Limited over a week ago to advance coal exploration┬á at┬á Sese in the Central District.
Sese┬áis┬ásome 50 kilometers┬ásouth-west of Francistown and is estimated to be having┬ábetween 1.5 to 2 billion tones of thermal coal buried underground.
The area is┬ásaid to have some impressive seam with an average┬áthickness of┬á14.8 meters which is also closer to the┬ásurface.
Under the disclosure African Energy┬áResources┬á┬á said the┬áloan priced, at 3.5 percent above the LIBOR, is expected to be fully paid by December 31 this year, adding that it has a call option of 4.8 million shares at 1.03 Australian dollars┬á in favour of Macquarie Bank.
They┬á further stated that the “large scale”┬á sampling test has got key areas to determine the coal washing┬á characteristics, provide samples to power stations to test suitability of coal generation and examine the ability of the existing┬á infrastructure to┬á deliver coal to┬á southern┬á African ports for export purposes.
The announcement by African Energy comes┬á right on the heels of another Australian company, Hodges Resources, that indicated that it has taken a 99 percent interest in strategic┬á coal prospects with a target of┬á 1.4 billion┬á tones at Morupule South.
The Morupule South Coal Prospect is adjacent to the operational Morupule mine and Colliery, which is the only operational coal fired power plant in Botswana.
Located within the eastern central district of Botswana, the Moruple South Coal prospect joint venture has significant mineable coal seams within the area supported by work completed by the current owner and the neighbouring companies and a preliminary report undertaken by GEMECS.
Importantly, the project areas have had minimal exploration and coal quality analytical work. To Hodges knowledge, no coal washing investigations have been made.
Botswana has extensive unexploited coal resources estimated to be in the order of 212 billion tonnes, making it one of the most coal rich countries in Africa.