Flowing with the energy, but moving into coal bed methane, Botswana-focused Tlou Energy Ltd, says its second quarter which ended June 30, has improved on its Lesedi coal methane project.
Shares in Tlou are trading 22 percent higher since the beginning of July.
Tlou says it entered into a contract during the period for a 250 kilometre 2D seismic programme with Velseis Pty Ltd, an Australian seismic acquisition and processing company. The seismic programme is scheduled to commence in the third quarter of 2017.
The company says it lodged a mining license application for its Lesedi coal bed methane project with Botswana’s Department of Mines in the Ministry of Mineral Resources, Green Technology & Energy Security, and additionally generated its first power from the project in the quarter.
“We continue to believe that Tlou is in pole position to emerge as the winner in the current Request For Proposal tender process and that the stage is now set for its transition into a leading Botswana independent power producer,” a Tlou broker said.
Lesedi is one of two projects Tlou has in Botswana and comprises five CBM prospecting licenses covering an area of approximately 3,800sq km. The group states that the Lesedi power project should be up and running in 2019 with an incremental build-up to 100 megawatts thereafter.
Further Gas has been produced in the Selemo area of the Lesedi operation for around a year, and overall Lesedi is estimated to host some 3.2trn cubic feet of gas as it is the most advanced CBM asset in Botswana.
“First Gas-to-Power via CBM in Botswana is an extremely significant milestone for the Company and in effect a proof of concept of ‘first gas monetisation’,” said Tony Gilby, Tlou Managing Director.
Gilby says that gas is a cheaper and cleaner alternative to diesel generation and is significantly cleaner than coal fired power generation.
“The issue of a mining license will pioneer the development of a new and exciting natural CBM gas industry in Botswana, an industry that will lead to a new indigenous source of energy and employment for the country,” he says.
“Over time it will potentially allow new manufacturing industries to develop using Botswana CBM gas and facilitate the creation of a new renewable energy industry,” Tlou believes
In addition, Tlou owns 100 percent of the adjacent Mamba field covering an area of approximately 4,500 sq km. In the event of a gas field development by Tlou, the Mamba area will provide the Company with considerable flexibility and optionality. At the same time, Tlou notes that the Ministry has indicated that it will extend the deadline for its Request for Proposal for the development of 100 megawatts of power generation.