Sese colliery to come on stream in two years

Brian Benza
Staff Writer | Tuesday November 1, 2011 00:00

 

Speaking during the company's listing ceremony in Gaborone yesterday, chairman Blackie Marole said the company's envisaged mining operation would bring both employment opportunities and significant economic benefits as the country turned to coal revenue for diversification within the mining industry.

'Whilst we have a lot of hard work ahead to complete the feasibility study and the environmental impact assessment, we believe that this project will be one of the first of a new generation of coal mines that will enable Botswana to become a major exporter of coal for many years to come,' Marole said.

The former Managing Director of Debswana added that a well-planned coal industry should become 'an engine of growth that could complement the diamond industry'. In the midst of persistent calls for the country to diversify away from mining, analysts also believed there was still a need to expand revenue sources within the diamond dominated mining industry, he noted.

Botswana has only one operating coal mine, Morupule Colliery, that produces approximately one million tonnes a year, but the country has approximately 212 billion tonnes of coal reserves in situ.

Before running into glitches recently, CIC Energy's 2.4 billion tonne coal project at Mmamabula was destined to become the country's next coalmine. Aviva's 850 million tonnes coal project at Mmamantswe has also run into snags and its promoters are scouting for new buyers.

In an effort to optimise benefits from the country's massive coal reserves, government recently placed a six-month moratorium on the issuing of new prospecting licences for coal, Coal Bed Methane (CBM) and related minerals pending finalisation of a Coal Roadmap.

The Moratorium has since been extended by a further three months to January 2012. Coal and CBM are among the most popular prospecting licences, with about one in four applications targeted at the energy minerals. Demand reached a peak in 2009 when 50 percent of all prospecting licences were for coal, CBM and related minerals.

Coal was discovered in the Sese area just over a year ago. Since then, Africa Energy says it has drilled over 350 exploration holes and defined a large coal resource that is suitable for both domestic use and the export market. Said Project Director, David Scott, at the listing:

'According to our indicative plans, the initial commercial production from the mine may commence by mid-2013. The coal is close to surface and a recently completed concept study indicated that it can be extracted using highly efficient open cut mining methods, offering a long life (and) profitable project.

Scott added that the company saw its dual listing as evidence of its commitment to Botswana. 'The listing will provide an opportunity for Batswana to share in the potential of the Sese coal resource,' Marole said in agreement.

African Energy listed 326,376,735 ordinary shares of a single class of no par value on the Foreign Venture Capital Board of the BSE. With a primary listing on the Australian Stock Exchange, it became the third company to have a dual listing on the local bourse this year after Lucara and Botswana Diamonds. The coal mining and exploration company listed at the price of P2,45.