The volume of coalbed methane held in a key asset in Botswana operated by Australia-listed minnow Botala Energy has increased by more than 40% to hit some 450 billion cubic feet, according to a third-party estimate. Botala is one of a number of junior companies — others include Tlou Energy and Kalahari Energy — that have been trying hard to commercialise CBM resources in Botswana over the past 20 years, but traction has been slow in a country reliant on coal-fired power. Botala has a 100% stake in the Serowe CBM asset and recently appointed Sproule Associates to assess its resource base.
The reservoir specialist has now concluded that Serowe’s contingent resources stand at 454 Bcf, compared to the previous 317 Bcf figure, a number that exceeded the company’s earlier expectations. Despite the resource increase, Botala’s share price still closed 1.2% down on Monday at A$0.083 (US$0.054). The company’s CBM resource lies in the Serowe, Upper Morupule and Lower Morupule coal formations, which have an average net thickness of about 33 metres. Botala has drilled six wells on the asset since April 2022 — the date of Sproule’s last report — which “confirmed the presence of significant coal intervals with free gas in all wells”, said the company.
Sproule estimated that the asset’s prospective resources fell from about 8 trillion cubic feet to some 7.1 Tcf. Chief executive Kris Martinick said: “I am thrilled by the significant increase in our… contingent resources and the potential of our CBM project in Botswana to supply gas to energy-hungry southern Africa, especially the nearby industrial heartland of South Africa.
“We are well-positioned to capitalise on this opportunity, and I look forward to the encouraging gas flow-rate investigations and negotiations with potential partners and customers delivering value to our shareholders.” Botala believes demand for gas in neighbouring South Africa will increase from early 2026, when Sasol will be unable to maintain the current level of gas imports from its fields in Mozambique, so plans to retain more of these volumes for its own industrial operations.
“These announcements have raised alarm across sectors that heavily rely on natural gas, including manufacturing, healthcare, and households,” said Botala, adding that this gas shortage “threatens to disrupt industrial operations, power generation, and domestic energy supply, with possible severe economic and social consequences.” Within Botswana, the company said it “aims to supply most, if not all” of the CBM needed to generate 100 megawatts of electricity. Botala is currently working on a pilot project called Pitse that aims to generate 10 MW of power. The company operates seven exploration licences in Botswana, all awarded in 2018.
Source: upstreamonline.com