Botswana: Minergy set to unlock vast coal resources

August 11, 2019, 10:38 am

“One small step for Minergy, one giant leap for Botswana’s coal industry,” says Minergy CEO Morne du Plessis.

With these words, a paraphrase play on American Astronaut Neil Armstrong’s famous speech at the first Moon landing in July 1969, du Plessis welcomed media representatives to the Botswana Stock Exchange (BSE)-listed Minergy Limited’s 390-million ton Masama Coal Project in the Mmambula Coalfield in the southeast.

This sentiment was echoed by coal analyst Xavier Prevost who said he expected Botswana coal to replace South African coal in the South African domestic market as mines in the Witbank area in Mpumalanga were reaching the end of their life.

“I absolutely think this is great news that Botswana is entering the coal market in a big way. There will be more coal producers in Botswana, for sure, just watch this space,” he said.

Botswana Minister of Transport and Communications Dorcas Makgato told the 14th Annual Southern African Coal Conference in January 2019 in Cape Town that her government aims to unlock the vast coal resources.

Botswana has more than 210 billion tons of coal or more than three times those of South Africa, but it has been long transport distances that have prevented Botswana from exporting this resource, while with a population of just over 2 million, there is little need for coal-based power stations like those in South Africa.

Botswana had only one operating colliery, which was the government-owned underground mine, which supplies its Morupule power station.

Botswana has strong macroeconomic fundamentals, solid economic and fiscal policies, and low public debt levels. It is perceived as one of the least corrupt countries in Africa and is ranked at 34 out of 180 countries compared with South Africa at 73.

This has meant that Botswana has far better credit rating than South Africa, which is rated junk by S&P Global Ratings, while Botswana stands at A- with stable outlook.

“The Mmamabula – Lephalale rail link will create an alternative corridor for export commodities. Collaboration and partnerships between governments and the private sector is critical,” she said.

From this month Minergy will be mining 110,000 tons run of mine coal per month. The same quantities will be put through the washing plant and this should result in saleable coal of between 70,000 to 80,000 tons, increasing to 100,000 tons per month next year.

The Masama mine uses a truck and shovel mining method with blasting taking place once a week on a Thursday with the mine operating on a six-day shift cycle with Sundays being a day of rest.

The mine practices a rollover rehabilitation process, so as the open cut proceeds to the east, so the open cut is filled in the west back to the original ground level, so the pit itself will only be as big as it is currently.

The mine has in excess of 340,000 tons exposed in the pit, which only needs to be blasted and put through the plant. This equates to roughly three months of feedstock.

It will initially truck the coal across the border to the Mahikeng rail head for distribution within South Africa to customers such as cement plants.

Coal and energy company Maatla Energy is likely to be the next mining company to start coal production in Botswana. Its Mmamabula coal mine has received approval of an environmental impact assessment and has submitted a mining license application to Botswana authorities for the mine and expects approval before the end of this year.

Helmo Preuss in Gaborone, Botswana for The BRICS Post