Botswana has a severe energy shortage and is currently relying on expensive imported power and diesel generation to deliver its requirements.
The energy market in Botswana are underdeveloped and will continue to suffer from a deficit of supply in the medium term. In response to power shortages in its domestic market of South Africa, the largest supplier of electricity in the region, Eskom, is progressively terminating power export agreements to other South African countries whilst continuing to rely on coal resources for its power stations. In addition, other southern African governments are demonstrating increasing levels of support for independent power producers.
Botswana is currently placing heavy reliance on expensive diesel generation due to unfulfilled import commitments from Eskom and the underperformance of the Morupule B coal fired power station.
There is considerable demand for CBM to play a major role in future power generation in Botswana in pursuit of energy security and optimising the energy mix. The current energy crisis is a major impediment to Botswana’s economic growth plans, and with this in mind, the government is highly supportive of new energy projects. Importantly, Botswana has a strong understanding of resources and is rated as being one of the most favourable environments for mineral investment, 14th out of 78 countries ranked (2011).
Tlou recognises that new venture opportunities can provide additional company growth, and in turn shareholder wealth. Tlou is constantly assessing new venture opportunity areas, and is committed to expanding into CBM prospective areas throughout the southern African region.
Formerly the British protectorate of Bechuanaland, Botswana adopted its new name upon independence in 1966. Four decades of uninterrupted civilian leadership, progressive social policies, and significant capital investment have created one of the most dynamic economies in Africa. Mineral extraction, principally diamond mining, dominates economic activity, though tourism is a growing sector due to the country’s conservation practices and extensive nature preserves.
Political & Financial Stability:
- Stable multi-party democracy.
- GDP per capita of US$ 16,000 (2014).
- Real GDP growth of 4.9% (2014).
- Average real GDP growth of 5.3% (2010-2012).
- US$ 8.9 billion foreign currency & gold reserves (2014).
Favourable foreign investment culture:
- No exchange rate controls.
- Low tax rate.
- Credit: A2 credit rating by Moody. (2014)
- Transparency International: Rates Botswana as having on the of the lowest corruption indexes in the world, 31st out of 175 countries (2014).
- Fraser Institute: Botswana rated as being one of the most favourable environments for mineral investment, 14th out of 78 countries ranked (2011)