Known as Ikaegeng XTL, the ambitious multi-billion-pula project has been in the works for more than a decade, which is seen as a transformational step towards fuel self-sufficiency. A previous attempt by government to self-finance the project was abandoned in July 2021 in favour of a PPP arrangement. At that time, Botswana Oil had a list of 11 companies, which it later whittled down to a shortlist of two.The PPP process was kicked off via a Request for Proposals from November 2023 to February 2024, without a suitable investor being identified. The RfP sought proposals from “competent developers to design, build, finance, operate, maintain and transfer the Ikaegeng Coal-to-Liquid Fuels (CTL) Facility, to be built in Botswana on a Public Private Partnership (PPP) basis”.“There was a public RfP, but we did not get an investor or financier that we felt was capable of achieving the requirements that we had put or fulfilling them,” Minerals and Energy permanent secretary, Donald Gaetsaloe, told a Parliamentary committee on Tuesday. “What is happening now is a targeted approach to talk to investors and others who know how to do these projects, projects of this level of funding, and we are going around seeing the interest in developing such.”A few years ago, the Ikaegeng XTL was projected to cost upwards of P30 billion and produce 12,000 barrels of fuel per day, contributing significantly to cutting the country’s oil imports.The latest revelations from the Minerals and Energy ministry run counter to initial reactions to the RfP, when Botswana Oil executives said there had been a “quite a number of companies expressing interest” in the project.The potential partners, however, reportedly backed out after receiving details of the RfP, which included feasibility studies and potential funding required.Gaetsaloe told legislators that a roadshow that has been running to hunt for investors has been extended.“There was an ongoing road show where government was doing an investor search because these projects are huge and there’s only a handful of companies in the world that can develop them. “There are companies in the United States and Asia that were identified and asked to submit proposals on this. “Our Ministry and the Finance ministry are going out there to find investors who can build a project of this magnitude,” he said.The push to accelerate the country’s fuel sources comes as local supply comes under pressure from troubles in South Africa’s refining capacity, as well as the frequent conflict in the Middle East. South Africa, which previously supplied nearly all of Botswana’s petroleum products, has suffered a rapid loss in refining capacity with several major plants suspended or ageing out of use.Botswana has been able to diversify sources of supply, and today it is estimated that Mozambique and Namibia contribute up to 60% combined.
