Coal mining and trading company Minergy has secured mining license for its 100%-owned Masama coal project located in south west Botswana.
The license, which was granted by the Ministry of Mineral Resources, Green Technology and Energy Security, follows the completion of a feasibility study and the authorization of the Environmental Impact Statement by the Department of Environmental Affairs (DEA) in Botswana.
Located in the Mmambula Coalfield, in south west Botswana, 50km north of Gaborone, the open-cast, low-strip ratio mine is expected to produce 2.4 metric tons per annum (Mtpa) of coal within a year after opening.
Minergy CEO Andre Bojé said: “This will be the first open-cast coal mining license granted by the Government of Botswana, so the process was not without its challenges for both parties. However, Government was so confident in our economic model that we were never in doubt that these could be overcome.
“Whilst the delay has brought the 2018 festive season into the equation moving first production and AIM listing timelines out, the license will truly enable us to reach our full potential with the Masama Coal Project, alongside our commitment to the development of the coal mining, marketing and distribution industry in Botswana.”
Minergy has already commenced certain pre-construction work at the 390 million ton (mt) Masama mine, which is scheduled to be commissioned in January 2019, and produce first saleable coal the month thereafter.
Expected to have a mine life of 100 years, the Masama coal project is estimated to have coal production capacity between 2.4 and 3.5 Mtpa at a steady rate during the initial 20 years of operation.
As per estimates, the Masama project has total resources of 82.3Mt from open cast and 307.7Mt from underground mineable coal.
Minergy has earlier signed 100% coal offtake agreement for the Masama mine with an international and regional trading house. The relating non-binding term sheet was received in May 2017.
The coal sales and trading for the project is managed by Minergy-owned coal trading company MinSales.