Botswana state-owned Botswana Oil says it will select, by December, a company to build and operate a $4-billion coal-to-liquids (CTL) plant, a facility that is capable of meeting as much as 80 percent of the country’s fuel demand.
The oil firm received 11 bids in August from a tender process and is subjecting them to “highly technical assessments,” its spokesperson Matilda Mmipi is reported to have said on Tuesday.
The coal-gas to liquids project, if implemented, will ensure the security of supply of petroleum products for Botswana as the country will be able to produce its own fuel to augment what it imports,” Mmipi said, estimating national fuel demand at 1.2-billion litres a year.
Some other demands will be met with renewable energy, including biomass and bio-diesel projects, she added.
The Southern Africa country is seeking to diversify its economy away from diamonds, its biggest export, and reduce its reliance on fuel from neighbouring South Africa, which supplies more than 90% of demand, leaving the country vulnerable to shortages in the event of labour strikes.
The country is also trying to take advantage of its more than 212-billion metric tons of estimated coal reserves.
Botswana produces about three-million tons of coal a year, nearly all of which is consumed by domestic power plants. Plans to export the mineral have been frustrated by the lack of a viable route for the landlocked country.