Shumba Coal lists on the Botswana Stock Exchange

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shumba photoShumba Coal, the junior explorer focused on Botswana’s untapped coal reserves estimated at around 212 billion tones, has listed on the Botswana Stock Exchange to make it the first majority locally owned resources company to become a member of the local bourse.

The listing of 168,846,078 shares on 8th of April 2013 on the BSE’s Venture Capital Board follows the placing of 7,111,100 ordinary shares of no par value in Shumba at a placing price of P1.00 per Shumba shares. Its executives said the key reasons to float shares on the local bourse were to establish a platform for future raising of development capital to realise the company’s growth plans, raise the regional profile of the company/brand and improve the liquidity of the share.

The company has managed to raise over US$ 3 million in the last 18 months, in addition to the P7.1 million raised in the recent placing. “The proceeds of this placing will, in addition to previously raised funds, be applied towards completing a full Preliminary Feasibility Study at Sechaba in the coming 12 months,” the company said in a recent media release.

Equally, the listing frees capital to consolidate Shumba Coal’s position in the industry by acquisition of other potential mineral assets or companies holding those assets and also focusing the attention of prospective investors on the merits of investing in Shumba Coal, thereby helping to enlarge the potential investor base for Shumba Shares.

Shumba Coal is a mineral exploration company, currently building a portfolio of mining and exploration coal projects. Through its subsidiaries, the company’s business is primarily focused on the identification of economically viable mineral prospects, the acquisition of such assets and the development of such prospects into full-scale mining operations.

The company currently has a prospecting license, the Sechaba Project, held by its subsidiary Sechaba Natural Resources (Pty) Limited, and has conducted extensive work including drilling and special studies on the site which have produced positive results, indicating the potential to produce coal by 2016 to supply a nearby power producer in addition to exporting coal at a later date.

The Sechaba Project, with 1 billion tonnes of good quality export thermal coal, is located some 47 km north-north-west of the town of Palapye. The Palapye area is where there is major exploration by other companies and it is where Morupule Colliery, owned by Debswana is located.

Due to its proximity to the A1 highway and the existence of large resources of ground water and two river basins, the project is potentially well situated for the development of a mine and a power station. In this first year Shumba Coal said it will continue its current exploration drilling programme to define a resource area, of suitable size for its proposed mine to sustain mining activities for a minimum of 30 years. The company said it also intends pursuing a secondary listing on the Mauritius Stock Exchange in the future following the successful listing on BSE.

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