Tlou Energy announces update on funding for development of the Lesedi power project in Botswana
Tlou Energy is focused on delivering cleaner electricity in Botswana and southern Africa using gas and solar power. The Company's first proposed development is the Lesedi Power Project in Botswana.
Tlou Energy has been working with a number of parties to secure funding for the Lesedi project. The Company is seeking project finance to build a transmission line from the Lesedi power project to the existing electricity grid as well as electrical sub-stations, gas and solar generation assets.
The most advanced project finance discussions are currently with a very reputable Botswana based entity. Due to confidentiality the Company is unable to name the entity concerned at this time. However, we can confirm that their investment committee and board have discussed and are favourably disposed to Tlou's proposal. They are now proceeding to get a third-party technical review of the project as part of their due diligence process. Once this report is assessed an investment decision can be made.
Tony Gilby, Managing Director, Tlou: ''We already have a great relationship with this group and look forward to working closely with them to get the process concluded successfully and as soon as possible. This is an outstanding project and with the right partners we believe it can be an overwhelming success both for Botswana and our shareholders.''
The Lesedi project is proposed to be developed in two phases. Phase one involves transmission line construction, sub-stations, grid connection, electricity generators and potentially the drilling of additional gas wells. The 100 Km transmission line will run from the Lesedi project to the town of Serowe where it will connect to the existing power grid. Initial generation is proposed to be up to 2MW of electricity. Funding required for phase one is $10 million which can be staged if necessary or prudent to do so.
Phase two funding is for the expansion of electricity generation up to 10MW. This will involve drilling gas wells and the purchase of additional electricity generation assets. Funding required for phase two is $20 million. Upon successful completion of phase one and two, the Company plans to expand the project beyond 10MW.
As expected, the Company has received correspondence from advisors assisting the Government of Botswana in the execution of their Coal Bed Methane (CBM) program for the development of up to 100MW of CBM fueled pilot power plants. This is a positive development with further discussions planned this week. The Company aims to progress this matter as quickly as possible.