African Energy Resources (AFR) - Successful rail delivery of Sese coal to Maputo
BACKGROUND TO PROJECT
The Sese Coal and Power Project comprises one wholly owned prospecting licence and six prospecting licence applications located in northeast Botswana, approximately 50km southwest of the town of Francistown (Diagram 1). African Energy discovered a large deposit of thermal coal at Sese in June 2010 and announced an updated Indicated Resource estimate of 2.5 billion tonnes of coal within Prospecting Licence PL96/2005 in February 2012. The Company expects to upgrade portions of the resource to Measured Resource category during the April-June quarter.
A bankable feasibility study and environmental impact assessment to evaluate a mining operation of up to 5Mtpa coal with the option for an associated mine-mouth power station of up to 600MW are in progress.
RAIL TRIALS USING EXISTING INFRASTRUCTURE
During the past six months, African Energy has been assessing options for transporting coal from Botswana to ports on the east and west coasts of Africa. To assist the Company with these evaluations, an external consultant has been appointed to provide specific input on coal chain logistics, including a desktop review of the existing infrastructure, the proposed Trans Kalahari and Ponto-Techobanine heavy haul railways, and an assessment of whether alternative rail and port solutions are viable. This work is ongoing as part of the project feasibility studies.
In the last three months, African Energy has held discussions with Botswana Railways and recently completed a trial shipment of Sese coal to Grindrod’s Matola coal terminal at the port of Maputo in Mozambique. A parcel of 25 tonnes of Sese coal was placed in bulker bags and loaded onto a train in Francistown on Tuesday, 3rd April (Diagram 2). A ceremony to mark this occasion was held at the Francistown rail station on 3rd April, attended by keynote speaker the Hon. Nonofo Molefhi (Botswana’s Minister for Transport and Communications), senior members of Botswana Railways board and management, representatives of the National Railways of Zimbabwe, African Energy Resources Botswana Chairman, Blackie Marole, and African Energy Resources board and management representatives (Diagrams 3 and 4). The ceremony was also attended by the Mayor of Francistown and other local dignitaries, members of the Botswana press, and was recorded and aired by Botswana television.
The trial shipment of Sese coal by rail to Maputo was completed in approximately four days via Bulawayo, southern Zimbabwe and southern Mozambique, a distance of approximately 1,350km (Diagram 1). The coal was unloaded at Grindrod’s Matola coal terminal on Wednesday, 11th April (Diagrams 5 and 6). This successful trial represents an important milestone for African Energy, and for the broader coal sector in Botswana as it demonstrates that coal can be transported in a timely manner to the east coast of Africa, a logical point from which this coal could be exported to markets in Asia (predominantly India and China).
African Energy and Botswana Railways have committed to continue working together to evaluate operational efficiencies and delivery of cost-effective short-to medium-term coal transport arrangements for Sese coal.
For the complete company announcement please download the following document: