Tony Gilby, Managing director of Australian and Botswana Stock Exchange (ASE/BSE) listed natural gas explorer, Tlou Energy (Pty) Ltd last week announced a ground breaking partnership with South Africa’s CNG Holdings.
Speaking from Canada last week, Gilby the partnership between Tlou Energy and CNG Holdings will establish an ideal business model for developing the gas market in Botswana. He added that Tlou Energy’s significant gas resource and upstream experience coupled with CNG’s expertise in compressed natural gas logistics and sales to industrial customers, represents an exciting opportunity to commercialize the natural gas business in Botswana.
“This is an important milestone for Tlou Energy. CNG currently supplies industrial customers in South Africa where there is a substantial lack of access to natural gas due to pipeline network constraints. Together we are looking to replicate this success. The Agreement serves to demonstrate Tlou Energy’s commercial viability in gas resources and the conversion to reserves,” said Gilby.
The parties plan to target industrial users in Botswana that currently utilise imported fuels such as diesel or liquid petroleum gas (LPG). Tlou Energy will provide further details once binding agreements are finalized. Meanwhile, Tlou Energy continues to progress its other gas commercialisation strategies, particularly the supply of gas to the existing 90 MW Orapa Power Station, through a current expression of interest process with Botswana’s Ministry of Minerals, Energy and Water Resources (MMEWR) and proposed new gas-fired generation projects.
Established in 2008, CNG Holdings supplies natural gas as an alternative energy source for industry and fuel for vehicles in South Africa. The upcoming industrial gas supplier operates three separate business units such as Virtual Gas Networks (VNG) which transports compressed natural gas by road to customers who are not on the existing gas pipeline network. The other arm NGV, supplies fleet owners, trucks, taxis and cars with natural gas through NGV gas filling stations, retrofits existing traditional filling stations and provides in-house natural gas filling facilities.
Likewise, its lateral subsidiary CNG Technologies supplies CNG equipment, providing advice and support to help industrial users and transport owners convert to natural gas. It also converts traditional vehicles to run on gas and services natural gas vehicles. Since inception, CNG has rapidly expanded its business to achieve major milestones. The company developed the Langlaagte CNG Mother Station in Johannesburg, generated its own power from natural gas to curb sole reliance on grid power. It also supplied gas to numerous industrial customers such as breweries, soft-drink manufacturers and hospitals. The development of a flagship vehicle filling station at Langlaagte in 2013 and retrofit of other filling stations in 2014 ranks high on its achievement list. Furthermore, the fuelling of 550 vehicles in 2014 and over 1000 minibus taxis in 2015 underscore industrial diligence at its best.