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Tlou Energy on course of achieving steady gas flows

Tlou Energy Limited, a multiple listed company, has achieved its initial sustained target of producing gas flows of approximately 20 000 standard feet per day at the Lesedi Three and Four coal bed methane (CMB) natural gas project.

In an operational report for the third quarter ending 30 September 2019, Tlou Energy managing director, Tony Gilby, said gas flow rates were anticipated to increase steadily at the two sites as the coal deposits became saturated. Tlou Energy is an Australian Securities Exchange, London Stock Exchange and Botswana Stock Exchange listed company focusing on delivering power in Botswana and the southern Africa through the exploration and development of CBM natural gas.

“Key events during the previous quarter (include) Lesedi 3 and 4 achieved initial sustained gas flows of approximately 20 thousand standard cubic feet per day (Mcfd) from each pod.  Gas flow rates (are) anticipated to increase steadily as the coals become gas saturated,” Gilby said this week. He added that core-hole drilling utilising Tlou Energy's own drilling rig commenced in the Mamba project area, with the objective of providing valuable data required for the expansion of the company's gas reserves and contingent resources.

“During the (third quarter) quarter the company's operations made excellent progress with the Lesedi gas production pods having achieved sustained gas production rates. “Following completion of the first phase of production testing, including initial dewatering, reaching critical gas desorption point and commencing gas production, the pods commenced producing sustained gas flows.  The initial rates were approximately 20 thousand standard cubic feet per day from each pod.  This was an excellent start and the company is very encouraged by production data to date,” Gilby said.

The MD said gas production was continuing and, as with most new CBM developments, the rate was anticipated to continue increasing following further reduction of pressure in the coal and additional dewatering, with the aim to reach a peak and commercial gas flow rate as early as possible. “The current stage of production involves maintaining pressure on the reservoir to further reduce water production, so that the lateral wells become gas saturated, rather than water saturated.  This is followed by reducing pressure in the wells to the desired level which, once achieved, is usually expected to significantly increase the gas flows from the wells.  

“This is a metholodical and detailed process and takes time to achieve.  The company will update the market on further progress in due course,” Gilby said. He anticipated that with the CBM projects not yet established in southern African region, Tlou Energy could pioneer CBM development within the region. “Successful results from this project could potentially facilitate the opening up of a whole new CBM basin in Botswana and be a significant boost not only for Tlou, but for the whole region, with the potential for Tlou to supply power within Botswana and also into neighbouring countries via the Southern African Power Pool (SAPP),” he said.

During the third quarter under review, Tlou Energy also commenced core-hole drilling in the Mamba project area.  Operations are being conducted using Tlou Energy's core drilling rig and as the company is not using external drilling contractors, the costs of core drilling are relatively low. “Core-hole drilling and core analysis provides valuable information regarding coal quality and gas content. This data is required for the expansion of the company's gas reserves and contingent resources and providing information to assess new areas for potential development,” said Gilby.


In 2018, Tlou Energy was selected as the preferred bidder of a tender from the Ministry of Minerals Resources, Green Technology and Energy Security for the development of a CBM-fuelled power plant in the country. If successful, the negotiations will result in the company agreeing to a Power Purchase Agreement (PPA) with the Government, whereby the Botswana Power Corporation (BPC), the national electricity utility, would purchase the power produced by Tlou Energy at the Lesedi project.

The tender negotiations are confidential and are being led by the Government.  The government has confirmed its commitment to the development of CBM-fuelled pilot power plants and is in the process of sourcing an advisor to assist them in tender negotiations.  Further information will be provided by the government in due course, with the next update expected after the country's general election. Tlou Energy has three project areas in the country, the Lesedi Project – currently under development and exploration, Boomslang Project – exploration and Lesedi CMB Project.

The Lesedi project covers an area of approximately 3,800 km2 and consists of four coal and CBM prospecting licences and a mining licence.  The mining licence area is currently the focal point for the company's operations and includes the gas producing Lesedi 3 and 4 development wells.  “The Lesedi project is the company's most advanced project, with plans in place to install gas-fired electricity generators and connect to the power grid in Botswana.  Subject to results, the first electricity sales could commence in late 2020.  

“The project has full environmental approval which includes gas extraction, electricity generation and construction of transmission lines.  In addition, the company has approval for 20MW of solar generation.  Clean CBM power is ideal for use in conjunction with solar projects,” Gilby said.

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Matsheka seeks raise bond program ceiling to P30 billion

14th September 2020
Dr Matsheka

This week Minister of Finance & Economic Development, Dr Thapelo Matsheka approached parliament seeking lawmakers approval of Government’s intention to increase bond program ceiling from the current P15 Billion to P30 billion.

“I stand to request this honorable house to authorize increase in bond issuance program from the current P15 billion to P30 billion,” Dr Matsheka said. He explained that due to the halt in economic growth occasioned by COVID-19 pandemic government had to revisit options for funding the national budget, particularly for the second half of the National Development Plan (NDP) 11.

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Lucara sits clutching onto its gigantic stones with bear claws in a dark pit

14th September 2020
Lesedi La Rona

Botswana Stock Exchange (BSE) has this week revealed a gloomy picture of diamond mining newcomer, Lucara, with its stock devaluated and its entire business affected by the COVID-19 pandemic.

A BSE survey for a period between 1st January to 31st August 2020 — recording the second half of the year, the third quarter of the year and five months of coronavirus in Botswana — shows that the Domestic Company Index (DCI) depreciated by 5.9 percent.

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Botswana Diamonds issues 50 000 000 shares to raise capital

14th September 2020
Diamonds

Botswana Diamond PLC, a diamond exploration company trading on both London Stock Exchange Alternative Investment Market (AIM) and Botswana Stock Exchange (BSE) on Monday unlocked value from its shares to raise capital for its ongoing exploration works in Botswana and South Africa.

A statement from the company this week reveals that the placing was with existing and new investors to raise £300,000 via the issue of 50,000,000 new ordinary shares at a placing price of 0.6p per Placing Share.

Each Placing Share, according to Botswana Diamond Executives has one warrant attached with the right to subscribe for one new ordinary share at 0.6p per new ordinary share for a period of two years from, 7th September 2020, being the date of the Placing Warrants issue.

In a statement Chairman of Botswana Diamonds, John Teeling explained that the funds raised will be used to fund ongoing exploration activities during the current year in Botswana and South Africa, and to provide additional working capital for the Company.

The company is currently drilling kimberlite M8 on the Marsfontein licence in South Africa and has generated further kimberlite targets which will be drilled on the adjacent Thorny River concession.

In Botswana, the funds will be focused on commercializing the KX36 project following the recent acquisition of Sekaka Diamonds from Petra Diamonds. This will include finalizing a work programme to upgrade the grades and diamond value of the kimberlite pipe as well as investigating innovative mining options.

Drilling is planned for the adjacent Sunland Minerals property and following further assessment of the comprehensive Sekaka database more drilling targets are likely. “This is a very active and exciting time for Botswana Diamonds. We are drilling the very promising M8 kimberlite at Marsfontein and further drilling is likely on targets identified on the adjacent Thorny River ground,” he said.

The company Board Chair further noted, “We have a number of active projects. The recently acquired KX36 diamond resource in the Kalahari offers great potential. While awaiting final approvals from the Botswana authorities some of the funds raised will be used to detail the works we will do to refine grade, size distribution and value per carat.”

In addition BOD said the Placing Shares will rank pari passu with the Company’s existing ordinary shares. Application will be made for the Placing Shares to be admitted to trading on AIM and it is expected that such admission will become effective on or around 23 September 2020.

Last month Botswana Diamond announced that it has entered into agreement with global miner Petra Diamonds to acquire the latter’s exploration assets in Botswana. Key to these assets, housed under Sekaka Diamonds, 100 % subsidiary of Petra is the KX36 Diamond discovery, a high grade ore Kimberlite pipe located in the CKGR, considered Botswana’s next diamond glory after the magnificent Orapa and prolific Jwaneng Mines.

The acquisition entailed two adjacent Prospecting Licences and a diamond processing plant. Sekaka has been Petra’s exploration vehicle in Botswana for year and holds three Prospecting Licenses in the Central Kalahari Game Reserve (Kalahari) PL169/2019, PL058/2007 and PL224/2007, which includes the high grade KX36 kimberlite pipe.

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