Natural gas explorer Tlou says it’s confident it can help solve southern Africa’s energy crisis, telling investors this morning it’s well-advanced in a government submission.

Tlou Energy is a Botswana-focused explorer focused on developing coal bed methane projects.

Coal bed methane — also known as coal seam gas — is a type of gas that’s found in coal beds. It’s typically extracted using unconventional methods such as pumping out underground water and lowering pressure, allowing gas to detach from the coal and flow out.

It could be an important part of Botswana’s energy solution — especially asd only 53 per cent of Botswana’s population is connected to power according to USAid, as the country struggles with southern Africa’s ongoing energy crisis.

Botswana relies on expensive imported power to meet demand, and as such, its Ministry of Mineral Resources Green Technology and Energy Security called for proposals to develop up to 100 megawatts of CBM-fuelled power plants.

It asked two companies: Tlou (ASX:TOU), which is listed on the ASX, London’s AIM market and the Botswana Stock Exchange, and local company Sekaname.

Coal bed methane gas well.
A coal bed methane gas well.

This morning, Tlou announced that the closing date for receipt of proposals had been extended to October 10, not at the company’s request.

It said that it was on track to submit a proposal by September 12, the original closing date, and still expects an initial response by the first quarter of 2019.

“Being the most advanced CBM project in Botswana, with significant gas reserves in place, environmental approval for upstream development and a mining license secured allowing us to commence development operations, we are in an excellent position to submit a comprehensive proposal,” Tlou said in a statement this morning.

“The project is achievable and can bring vital power and employment to the region.”

Earlier this year Tlou shares dropped 36 per cent after it was forced to repeat the tendering process for the power plant. Its shares were flat on today’s news, sitting at 12.5c.

Tlou shares (ASX:TOU) over the past year.

Tlou says its proposal will be an initial staged development, starting at up to 10 megawatts of power generation, before investigating further power generation depending upon demand.

It wholly owns what it describes as “the most advanced gas project in the country”, the Lesedi CBM project. If successful in Botswana, Tlou says it hopes to deliver the energy to nearby countries as well.