Australian coal miner set to light up SADC

By Mpho Tebele

Gaborone – Power shortages in the Southern African Development Community (SADC) region have led some coal-producing companies, such as Australian Securities Exchange (ASX)-listed energy company, African Energy Resources (AFR), to embark on multiple integrated power projects to meet escalating demand.

AFR this week said it would forge ahead with plans to fully develop integrated power projects in the SADC region. A move expected to offset power deficit, which the region has been experiencing for some time.

The three projects in Botswana, funded by development partners with minimal cash required from AFR, are Sese JV, which is the biggest at over 5 billion tonnes of coal deposits, Mmamabula West with 2.4 billion tonnes and Mmamantswe, which has about 1.2 billion tonnes of coal.

According to AFR, findings show strong regional power demand in Southern Africa, which is linked to population growth and increased standards of living. While power shortages in the SADC region are attributed to different reasons for each country. A research by AFR revealed that South Africa has the largest power deficit of 21,000 MW followed by Zambia with 12,000, Zimbabwe at 950 MW while Botswana and Namibia need 600 MW to meet power demand.

According to the company’s latest update on power projects, regional power demand will increase based on sub-Saharan Africa’s forecast population growth.

Populations were forecast to double between 2010 and 2015, with energy consumption forecast to double in the same period as well.

With no clear strategies on sight regarding the use of clean alternative energy, AFR said it was counting on countries turning to coal as a source of energy.

AFR has noted that the Sese Integrated Power Project, in which First Quantum Resources has taken a controlling interest and management control, is at an advanced stage and has potential to feed power into the Botswana national grid and then on to Zambia, Namibia, South Africa and Zimbabwe.

The Mmamatswe West Project, which AFR is in the process of selling to a South African developer for US$20 million, has the resources and potential to supply coal power to the grid under an independent power project procurement programme as well as export potential for coal in the longer term.

In partnership with experienced developers, AFR is developing these multiple sizeable base-load power projects in Botswana, which will sell power to off-takers in the Southern African Power Pool, whose member companies are experiencing long-term, large-scale deficits in power                                             generation.

AFR said countries such as Zambia and Botswana currently rely on expensive diesel-fuelled generation, as part of their base-load, in some cases importing diesel-generated power at up to 18 US cents per kWh.

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