A scoping study on Walkabout Resources’ Takatokwane thermal coal project in Botswana has showed that the mine can produce 12 million tons.

The mine design has focussed on the target mining area where 748 million tons have been categorized under 2004 JORC indicated resource.

Modelling showed net present value of $850m and internal rate of return of 14% under conservative production and pricing.

The project requires capital expenditure of $767m and operating and logistics costs of up to $57 per ton FOB.

The project is expected to have two open-cut strip mines each mining around six million tons of coal a year; however, this can be significantly up-scaled in modular extensions.

Using a modular two stage washing plant, certain product will be upgraded and the three products will be available for despatch.

Walkabout Resources managing director Allan Mulligan said: "We now know that we will be building large scale, open cut strip mines employing drag – lines and rope excavators that will produce coal for many years in to the future.

"Similar to those planned for the Galilee Basin in Australia, these are going to be long life, stable mines that supply the emerging economies of the world with energy for generations to come.

"The Takatokwane complex will not be just a mining site but an entire coal mining province."

The principal activities covered in the study include resource modelling, water management study, environmental management, logistics and transport, coal washing, mining and engineering.

Walkabout Resources holds 67% of the Takatokwane coal project through two joint ventures with Botswana-based companies.