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Strata X brings future clean energy

SHARE   |   Friday, 06 September 2019   |   By Ditiro Motlhabane
[L-R] Tim Hoops with Mining consultants Modisana Botsile and Michael Ntisetsang of MB Advisors [L-R] Tim Hoops with Mining consultants Modisana Botsile and Michael Ntisetsang of MB Advisors

Wowed by the discovery and envisaged production of a clean energy source for homes and industries -Coalbed Methane (CBM)-about 80km outside Serowe in the Central District by mining giant Strata X Energy, STAFF WRITER DITIRO MOTLHABANE pinned down its Managing Director Tim Hoops for a chat about the project.

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Bouyed by the discovery of massives reservoirs of CBM, also known as coal seam gas, on exploration sites near Serowe, Strata X is on a worldwide campaign to find partners/ investors for the development of the resource. Currently based in Colorado (USA), Hoops is not shy to boast that the company enjoys extensive experience and skills, backed by over 30 years operating in extraction of compressed natural gas in countries like Australia. In Botswana, Strata X is trading under the name Sharpay Enterprises, picked from the shelf. Do they mine gas, really?

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"Not mining per se, we extract gas from coal reserves. The coal stays in place. A plus for Serowe discovery is that the geology of the rock is similar to Queensland, Australia where we have operated before. The type of coal (hard and bright) is good for methane production," quipped Hoops, a smile greasing his lips in anticipation. He flatly denied that they could consider fracking, which has been criticised the world over, saying it is not a viable technology despite it delivering some benefit in North America in the past.

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In fact, Hoops emphasised that with the advent of the Fourth Industrial Revolution they have the latest digital technology and use big data to improve efficiencies by accurately forecasting output rather than being reactionary. Because of lack of connectivity due to the remoteness of the targeted area, Hoops revealed that once production gets underway a full satellite connection will be set up to enable the use of technology in their operations.

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Strata X recently got a major boost when the Department of Environmental Affairs approved the form and scope of the company’s new Environmental Impact Assessment (EIA) on the Serowe CBM Project following on the field-work, community consultations and development planning. Hoops said, among other things, such approval is confirmation that they have complied with regulatory requirements to safeguard freshwater sources (an essential resource) from gas zones.

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He explained that the company EIA report will be submitted for final review in September 2019. Once the EIA’s final approval is granted, which is expected to occur in December 2019, Strata-X will have clearance to drill and test up to 75 wells covering 3 prospecting licenses within the high-grade area of the Botswana CBM fairway. In total the Company holds 320,000 acres (1,295km2) within the identified high-grade area spanning five, 100% owned licenses. Previous environmental approvals acquired in 2018, covering two of the Company’s original Serowe CBM licenses, granted Strata-X the right to drill and test 20 wells. Once the EIA’s final approval is granted, Strata-X will have the authorization to drill and test up to 95 wells covering all of the 100% owned high-grade area before converting the area to full scale production licenses.

"We did air drilling only in the approved 20 wells. We are now seeking 75 more after we identified a high grade area covering a total one million acres (under the 6 exploration licences each covering 1 000km2)," said Hoops, putting an estimate of the actual size of the resource at around six trillion cubic. That is, more than enough energy (gas) to supply Botswana for over 200 years!

About CBM

Coalbed Methane (CBM) is an unconventional form of natural gas found in coal deposits or coal seams. It is a primary clean energy source of natural gas.  Also known as coal seam gas, CBM is a natural, colorless, odorless mixture of various gases (primarily methane) that is extracted from coal at a depth of 200–1000 m. CBM is formed during the process of coalification by transformation of plant material into coal. It is generated by either a microbiological or thermal process as a result of increasing heat at greater depth during coal formation.

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Over the last several decades, CBM has emerged as an important energy source in the United States as well as worldwide and is expected to play a significant role in the energy portfolio of the future. The development and utilization of CBM is of great social and economic benefit. It is a clean-burning fuel (compressed natural gas—CNG) for domestic and industrial uses. The extraction of CNG reduces explosion hazards in underground coal mines.

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Why CBM (benefits)?

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Despite having a clean energy resource in abandunce Botswana continues to suffer huge energy deficit, which leads to dependence on imports from the likes of Eskom,South Africa. Hoops emphasised that energy deficits lead to frequent lengthy power outages, which affects homes and different sectors of the economy negatively. This can be reversed if

cheaper, readily available resources like CBM are utilised, said Hoops.

According to Hoops, although it produces the same output and yield as conventional energy sources like coal or diesel, CBM is a cleaner source which does not have any undesirable emissions that pollute the environment. No chemicals are used in extraction of CBM. Unlike wind and solar energy, which rely on natural weather patterns, once extracted compressed gas becomes available for 24 hours throughout the year. It slong term effect on the environment is much lower than any other energy source, said Hoops.

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"It is a cheap domestic resource that can reduce the import bill for diesel, which is used in many sectors of the economy like mining, transport and logistics, agriculture etc. To attain a trade balance, Botswana can export excess produce to neighbouring countries," he said, reiterating that in developed countries like the US buses in Denver, trucks and even trains are using compressed gas a source of energy.

 At full production Strata X forecast to employ approximately 2200 people directly, depending on the size of the project. More will be employed in downstream industries. "The use of CBM has a multiplier effect in that starting from extraction throughout the value chain jobs will be created in different sectors. Further, from the expertise and experience we will be bringing, we will transfer skills and technology to the local economy," Hoops added, matter-of- factly.

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Should Strata X secure a sponsor, Hoops said one of their first initiatives will be to familiarise locals with the use of gas to replace firewood in homes. The use of firewood, experts say, has led to rangeland degradation that contributes to global warming as forests disappear and the smoke it produces has been found to have negative health implications for users. "A number of homes will be identified in different villages around Serowe (the villages have a total population of around 26 000). We will then provide them with free gas to replace firewood as a way of empowering communities where we operate," said Hoops.

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The 'downside' in Strata X's quest to court investors for the Serowe CBM project is that due to good governance since independence, very little is known about Botswana. "We have to explain a lot about the place we are talking about. Some confuse Botswana to be part of South Africa. One of the positives is that corruption is not rampant like in other countries where I have been approached by government officials telling me to bring a bag full of money for them to give me a major project. We pulled out of that country," said Hoops, closing the conversation with a chuckle.



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