Sasol, Aus firm in Botswana energy JV

3 November 2011

South African petrochemical giant Sasol has entered into a joint venture with Australia’s Origin Energy, forming a new company called Kubu Energy Resources that has acquired three licences to explore for coal bed methane gas in Botswana.

The three prospecting licences cover an area of approximately 3 000km² and are located in the central province of Botswana.

“The joint venture partners plan to conduct a number of exploration activities in the licence area during the next two years to determine the quantity of natural gas available and the feasibility for future commercial development,” Sasol said in a statement this week.

“The first phase of the exploration will include an airborne magnetic survey, sampling of borehole cores and the drilling of test wells.”

If the first exploration phase proves successful, the joint venture partners will consider committing to a more extensive exploration programme in Botswana.

Clean natural gas by-product

Coal bed methane is a clean natural gas by-product of ancient plant matter, trapped in underground coal seams. It is produced through a process of desorbing natural gas from coal using wells drilled for that purpose – similar to the mine safety processes used in degassing coal mines.

The water that is produced during the production process is pumped to the surface and treated so it can be disposed of or recycled for beneficial purposes such as agriculture.

Although coal bed methane is produced by unconventional means, it is sold and used in the same manner as conventional natural gas.

Early stage of development

Coal bed methane exploration is still in the early stages of development in southern Africa. However, coal bed methane accounts for approximately 10% of total natural gas produced in the United States, and makes up most of Australia’s natural gas supply.

“A discovery of large volumes of coal bed methane in Botswana could be used to generate power and liquid fuels in southern Africa,” said Sasol. “The need to decrease greenhouse gas emissions also favours the increased use of natural gas as an alternative to coal.”

The transaction is subject to final approval by the Botswana government.

SAinfo reporter

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