Coal exploration company Minergy is looking to assist in Southern Africa’s energy deficit crisis with its large, shallow, low cost Masama coal project in Botswana.
“Minergy’s Masama project is a unique coal asset, with high quality coal at opencast mining depths. Situated within Botswana’s premier Mmamabula Coalfield, Masama’s location is low risk with excellent existing infrastructure nearby. It presents a range of scalable development opportunities at low capital intensity,” says Claude de Bruin, Executive Director of Minergy.
Minergy’s flagship asset comprises a reported 2.8 Bt export-quality coal deposit and covers about 700 square kilometres.
“We have a diversified value extraction strategy for the asset, consisting of a three-pronged approach that includes supplying the roughly 16 Mtpa regional merchant coal trading market. South Africa is a sizeable proportion of this market and coal from Masama would be delivered to customers on existing infrastructure in very close proximity to open-castable portions of the coal deposit,” says de Bruin.
The electricity supply situation in Southern Africa has changed significantly over the past few years, with national power generators finding it increasingly difficult to meet domestic electricity requirements.
A major regional electricity generation deficit has resulted, with domestic supply constraints leaving regional power importers supplied on a best efforts basis. Several Southern African utilities and regional industrial consumers are now actively looking for power supply solutions.
“Masama is competitively positioned to participate in the regional power generation opportunity. The project represents a low risk, secure fuel source with no major barriers to a relatively quick development timeline, and it is located less than 20 km from major power infrastructure into the SAPP power grid,” notes de Bruin.
The asset also has potential to export coal to India, Asia and Europe. “Visibility on the global commodity cycle will impact the timing of the export opportunity, whereas regional markets have specific domestic drivers,” De Bruin mentions.
“Population growth, and in particular expansion of the middle class is a major driver of long term global energy demand growth. Regardless of the energy mix, more of every kind of energy will need to be harnessed as efficiently and responsibly as possible as millions of people are pulled out of poverty. There is no doubt that energy demand will not dissipate.”
“High quality energy assets such as Masama will play a key role in meeting the world’s energy needs, and the company will also be actively looking at other high quality investment opportunities in Southern Africa,” concludes De Bruin.