SA’s R80bn methane project

NT Energy UK, its empowerment partner Bataung Oil and the state-owned Central Energy Fund are to begin exploration for coalbed methane reserves as part of a project to develop sustainable sources of alternative energy for the country.

Engineering News reported last week that GascoSA, which is exploring for the gas in three South African provinces, could be in commercial methane production in 18 months, spending US$169-million (about R1.1-billion) by the end of that period.

GascoSA is 60% owned by NT Energy Africa, which comprises NT Energy UK and local empwerment company Bataung Group, and the state-owned Central Energy Fund (CEF).

According to its website, CEF is involved in the search for appropriate energy solutions to meet the future energy needs including oil, gas, electrical power, solar energy, low-smoke fuels, biomass, wind and renewable energy sources.

It also manages the operation and development of the oil and gas assets and operations of the South African government.

According to BuaNews, the project, which is endorsed by the Department of Minerals and Energy as part of its mandage to secure energy for the coutry, represents a potential investment of U$10-billion over the next seven to 10 years in infrastructure and a pipeline rollout.

Bataung Group chairman Billy Modise said that for the country to meet its development and job creation targets as outlined by the Accelerated and Shared Growth Initiative for South Africa (Asgi-SA), developing a sustainable source of alternative energy had become non-negotiable.

“The development of sustainable sources of alternative energy has become a strategic priority for South Africa, especially as current demand continues to outstrip capacity,” Bataung Group MD Kinesh Pather told BuaNews. “Coal bed methane and the conversion of gas to liquid fuels provide a real, clean and long-term alternative to the current energy crisis.”

NT Energy official Chris Mumby told Mining Weekly Online last week that the company had spoken informally with state-owned electricity utility Eskom about methane uptake, while it was also open to partnering with independent power producers.

According to Engineering News, studies to reveal gas content would be completed by the middle of 2008, and viability studies by the fourth quarter of the year. If viable reserves are found, production drilling would take a further year.