Tlou Energy Limited provided an update on the construction of a power transmission line for its coal bed methane (CBM) extraction and power generation plant at Lesedi, west of Serowe in Botswana.
Tlou said overall progress achieved is currently 11% which is up from 8% reported last month, although the planned target was 17% indicating a slippage of 6%.
A 66 kilovolt (kV) transmission line and associated substations will connect the plant to the Botswana Power Corporation (BPC) grid at Serowe. The grid connection project is divided into two project parts; (i) the 66kV overhead transmission line, and (ii) the substation works at both ends of the line.
The 66kV transmission line construction contract between Tlou and Zismo Engineering was awarded on March 2, 2022, and commenced in April. The contract is expected to take approximately 15 months to complete, the company said.
The substation works tender has been awarded to OptiPower, a division of Murray & Roberts Ltd. The substation contract has not yet been signed and will be done once additional funding is in place, it added.
Progress to date:
- Line survey is 96% complete. The remainder relates to the steel pole section.
- Bush clearing is at 60%, delayed but without impact on program.
- Line pegging and inspection at 50%. Delays incurred because of other services on the servitude (right of way) such as water pipelines and crossing low voltage powerlines. All being attended to.
- Pole dropping at required locations along the route is at 42%.
- Pole dressing (adding required equipment to poles) is only partially complete because of delays in delivery of U-bolts.
- Discussions were required with BPC in relation to an 11kV line that has been built across the Tlou 66kV servitude. BPC have proposed to move their line out of the servitude. This work is not expected to cause a delay as it can be completed while other parts of the project are ongoing.
The slippage to date may be recovered in the coming months, the company noted. Procurement and other issues outside the company's control could delay the project further which will be advised in further updates if necessary, however, it said, at this time the transmission line section should remain close to the target completion date of mid-2023.
The Lesedi Power Project is located in Botswana's Central District, approximately 100 kilometres (km) from the existing electricity grid. The 66kV line being constructed will be capable of carrying up to 25MW of power. Initial electricity generated will be sold to Botswana Power Corporation, the national power utility under an agreed 10MW Power Purchase Agreement (PPA).
Tlou has been producing gas at its Lesedi 3P and Lesedi 4P production wells. The company has taken the decision to temporarily shut in the Lesedi 3P well as sufficient data exists from this well and there is no need to incur further production costs at this time. The well can be brought back into production as required. Gas production at Lesedi 4P is planned to continue.
In early trade on Tuesday, Tlou shares were 3.5% higher at 1.50p.