JOHANNESBURG (miningweekly.com) – Aim- and ASX-listed energy company Tlou Energy, which is focused on delivering power in Southern Africa through the development of coal-bed-methane (CBM) projects, announced Tuesday that its Lesedi CBM project in Botswana would be fast-tracked for development and probably expanded beyond the 10 MW originally envisaged to 50 MW, following and offtake agreement with the Botswana government.

Tlou, which was still awaiting details from the Ministry of Minerals, Energy and Water Resources (MMEWR), noted that the Botswana government had recently announced that the delivery of 100 MW of CMB power would be incorporated into its future generation supply plans.

This, said Tlou acting MD Gabaake Gabaake, was an indication of the government’s support for the development of domestic sources of power and created a ready market for Tlou’s independently certified contingent gas resources of about 3.3-trillion cubic feet.

“We are elated by this decision and look forward to receiving the full details from the MMEWR,” he said, adding that the 50 MW offtake agreement provided Tlou with more financial impetus to increase the power output at Lesedi while the project was being developed.

“A larger project also provides more options regarding project development, as well as potential benefits from economies of scale. We also believe it has the potential to strengthen the range of parties interested in partnering to finance the project’s development.”

Gabaake considered the offtake agreement a “significantly transformative” outcome, which was testament to Lesedi’s status as the most advanced CBM project in Botswana, and reflected Tlou’s strong governmental relationships.

“We look forward to updating the market in due course as we make progress towards fulfilling our vision to become a significant provider of energy in the region,” he said.

Tlou noted that, once it received full details on the agreement from the MMEWR, it would start work on a detailed proposal for the supply of CBM power, including negotiation on the terms of the offtake agreement, network access and project funding.