Government through the Ministry of Mineral Resources, Green Technology and Energy Security is facilitating for the private sector to build a $4 billion (P42 billion) Coal To Liquids (CTL) plant over a four to five year construction period.
The development of a CTL plant, which makes fuel from coal, is expected to make the country fuel sufficient with the potential of being a net exporter of petroleum products in the region. Botswana currently imports all her petroleum requirements from South Africa with small quantities coming through Namibia and Mozambique.
Speaking at a Mining Investment conference this week, Botswana Oil Limited (BOL) chief executive officer, Willie Mokgatlhe said the Ministry has tasked BOL to facilitate the private sector in the realisation of this project adding that they have engaged experts in the field to provide Technical Advisory Services.
“Government recognises the importance of this project to the economy as it would contribute significantly to economic diversification,” he said. Mokgatlhe said that the plant, which would have a lifespan of 30 to 40 years once developed, would create about 15,000 jobs during the construction phase and 4,000 jobs on permanent basis. However, he noted that the biggest challenge is that the plant requires substantial investment and estimated that it would meet the country’s current annual demand of 1.2 billion litres. According to Mokgatlhe the plant came as a result of the study that determined the coal roadmap that was
Briefing parliamentarians recently, the minister of Mineral Resources, Green Technology and Energy Security Sadique Kebonang said that upon completion of the plant, it would replace the current importation of approximately $1 billion worth of fuel noting that the expenditure would be too high for government under the current financial pressures.
“My ministry has developed a Prequalification criteria which will be used to select companies that can be facilitated in order to realise the project,” he said.
The CTL project entails converting coal into liquid fuel using several liquefaction processes, which can be divided into two general categories being indirect liquefaction and direct liquefaction. “We are currently at concept stage with no detailed studies conducted yet. The project schedule and timelines will become realistic once the consultants are on board and that will be this month. The private sector also continues to explore avenues of implementing the project,” he said. In addition he said that the location of the CTL plant will be greatly influenced by the availability of raw materials, the distance of which to the plant is critical to keeping production costs low and manageable.