Gov�t issues pioneering gas mining licence
Brian Benza | Wednesday August 23, 2017 18:00
Emerging junior energy company, Tlou Energy this week announced that a mining licence for its Lesedi CBM project has been granted by the Department of Mines paving way for the development of Botswana’s first gas to power station.
Apart from a small 1.3MW solar power plant in Phakalane, Gaborone, the remainder of the country’s local power supply is met from coal-fired power plants.
In a statement, Tlou said the mining licence, which covers an area of approximately 900 square kilometres, gives security of tenure over the project area.
“The mining licence for the Lesedi CBM Project was the first application of its kind to be lodged in Botswana. The awarding of the mining licence by the ministry is a major milestone for the company, further de-risks the project, and is an important prerequisite to developing the first commercial gas-to-power project in the country,” Tlou’s managing director, Tony Gilby said.
“The issue of a mining licence 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, income and employment for the country,” he added.
The company has the most advanced CBM project in Botswana with an independently certified contingent resources of 3.3 trillion cubic feet (3C) at Lesedi, making it the most likely to develop Botswana’s first CBM power project.
Earlier this year, the company received a Request for Proposal (RFP) from the government for the development of up to 100MW of CBM fuelled pilot power plants in Botswana.
Tlou, which holds 10 prospecting licences covering an area of 8,300 square kilometres in Botswana, is one of the two companies selected to bid for the development of up to 100MW of power using CBM as an independent power producer (IPP).
The government has developed this initiative to allow companies such as Tlou to develop pilot plants and facilitate the development of their CBM resource to levels which may lead to the supply of gas to the state-owned 90MW Orapa Power Plant, which is situated approximately 150km to the north of the Lesedi CBM Project.
In 2015, the government floated a tender inviting companies to express interest in the supply of gas to the Orapa 90MW power station.
The dual fuel power station is currently running on diesel and the tender is part of plans to convert the plant to CBM.
This is expected to reduce the cost of producing electricity at the power station by up to 60%.
It is estimated that the two turbines of the power plant consumes up to 17,000 litres of diesel per hour at peak use.
Conversion of the power plant to CBM is estimated to reduce the costs of producing electricity from 24 cents (P2.28) per kilowatts to about 10 cents (90 thebe) per kilowatt.
In the next five years, the government hopes to deliver up to 800MW of power through IPPs using coal, solar and CBM resources.