Gaborone, Feb 12 (IANS) Australian miner Hodges Resources has announced it has approved feasibility phase studies for its Morupule South coal project in central east Botswana, with a start up of between two to three million tonnes per annum.
Hodges said in a statement Monday that after positive scoping and conceptual studies, the project is confirmed as being financially viable, and feasibility phase studies have been approved.
"After extensive evaluation of all the independent studies the Board of Hodges has approved the commencement of feasibility level studies to refine the operational and capital cost estimates associated with a staged development up to 10 metric tonnes per annum run of mine coal operation," said Mark Major, Hodges, managing director.
The primary objective of the scoping study was to investigate the fundamental economic viability of the Morupule South mine coupled with various development options.
The studies have also identified areas where additional operational and possible capital cost savings could be achieved.
"Despite having the resources to support this, a run of mine production scenario of 20 million tons per annum has not been considered appropriate at this stage until developments are made to the existing rail and port infrastructure," Major said.
Hodges will instead focus on the feasibility of an initial stage of operation requiring less capital and supporting an operation for the domestic and regional coal markets with a run of mine ranging from 1.5 to 3 million tons per annum.
According to the company, the resource estimate for the project stands at 2.45 billion tonnes of which, 110 million tonnes is measured, 173 million tonnes is indicated and 2,167 million tonnes is inferred.
Hodges said the entire resource area has the potential of more than 96 years life of mine at a production rate of 20 million tonnes per annum.
Botswana has extensive unexploited coal resources estimated to be in the order of 212 billion tonnes, making it one of the most coal rich countries in Africa.