- Tsaone Segaetsho
BSE-listed Botala Energy has announced that it has received firm commitments from sophisticated investors to raise approximately A$1.87 million (equivalent to P16,540,000) at A$0.056 per share. This funding will be utilised for the much-anticipated Project Pitse in central Botswana as part of a two-tranche placement.
Botala Energy specialises in the exploration and development of coal bed methane (CBM) in Botswana, with Project Pitse situated in the village of Serowe. According to a statement from the company on Wednesday, Botala aims to target commercial offtake agreements and secure a strategic development partner for the wholly-owned Serowe CBM Project.
The funds raised will be used not only to commission Project Pitse but also to commence a Bankable Feasibility Study based on LNG supply to the Johannesburg market, the company confirmed.
While Botala noted that the placement received strong backing from new and existing institutional and sophisticated investors, the board plans to contribute A$315,000, subject to shareholder approval at the company’s upcoming Annual General Meeting. The issue of new shares under the placement (excluding the shares to the board, which will be subject to shareholder approval) is expected to take place on or around 28 October 2024.
“It is fantastic to see the strong support from our existing and new investors for our projects. Management and the Botala board have strongly backed this raising. We believe in the project and are excited about ongoing negotiations. The secured funds position the company to focus on securing a strategic development partner and targeting commercial offtake agreements,” said Botala Energy Chief Executive Officer Kris Martinick.
Regarding Project Pitse, Botala explained that the current appraisal phase includes the drilling of four new appraisal wells, with geographical data being used to accurately determine their locations. These wells, drilled and tested with a 250-500m spacing in a square pattern around the Serowe 3 well, are part of further testing of the Serowe 3-1 well.
“All the wells will be logged to determine coal depths, thicknesses, correlations, and coal continuity. The composition of CBM obtained from Serowe 3 and its surrounding wells will be measured regularly,” stated the Project Pitse overview.
Botala also highlighted that the proposed layout will help define reservoir boundaries and assess pressure communication between wells. Pressure communication and radial extent can be determined from interference tests conducted at timed intervals during production. The results will be used to estimate optimal spacing and well density for commercial development, the company added.
