Tlou Clinches Power Deal for Botswana CBM Project

Australia's Tlou has signed an interim power purchase agreement (PPA) with Botswana Power Corp. (BPC) to supply electricity from a pilot 2-MW coal-bed methane (CBM) to power project, it said on April 3.

Tlou is in talks with financiers for the project that have been waiting for this interim PPA to be in place, it said. The terms of the agreement are confidential.

"A pathway to revenue generation is key for financiers and once connected to the grid, expansion of the project (and thereby increasing revenue) is seen as a relatively straightforward and largely de-risked process," the company said.

Tlou is developing the Lesedi CBM development in eastern Botswana. Exploiting the resource can help the southern African country overcome chronic power shortages, it says.

The company filed a proposal with Botswana's mineral resources ministry in 2018 to develop a larger 10-MW CBM to power plant. This proposal is still being reviewed by the ministry and BPC, it said.