The coal-rich Botswana has an opportunity to create thousands of jobs if it were to convert its large quantities of coal reserves it has into liquids and in the process help the country diversify its economy. Botswana Oil Limited (BOL) chief executive officer, Willie Mokgatlhe told the inaugural Mining Investment Botswana that the 212 billion coal under the ground can be turned into opportunities that can create 15, 000 jobs when the coal to liquid plant is being built and 4, 000 permanent jobs when it becomes operational.
“This is a sizeable number of jobs. If you have a plant like this, you will immediately replace some of the jobs you have lost in the mining industry,” Mokgatlhe said, adding that the country can also be able to export liquids products and have an import substitution of $1.2 billion.
More than 10, 000 jobs have been lost in the industry with the recent closure of BCL Mine and Tati Nickel keeping Cabinet’s mid night oil burning to try and secure a buyer for the assets. Already, it has emerged there is an interested potential buyer from Dubai.
BoL feels that although such projects are capital intensive, Botswana will not only be a consumer but exporter of liquids products to the region where South Africa imports most of its requirements. “It also gives us the opportunity to diversify the economy,” he said. Equally, the vast coal resources will make the country a major energy player in the region. South Africa alone imports between 150, 000 to 180, 000 barrels per day of liquids fuels, which in itself presents a market for Botswana.
Mokgatlhe admits the project comes with its own challenges including the fact that Botswana will have to compete with trail blazers like Sasol, the South Africa’s international integrated chemicals and energy company. “Sasol plays a major role in this space,” he admitted.
Sasol said on its website that through its proprietary technologies and processes the main products it produces are: fuel components, chemical components and co-products. From these main products and further value-adding processes it delivers diesel, petrol (gasoline), naphtha, kerosene (jet fuel), liquid petroleum gas (LPG), olefins, alcohols, polymers, solvents, surfactants, comonomers, ammonia, methanol, crude tar acids, sulphur, illuminating paraffin, bitumen and fuel oil.
According to Mokgatlhe, Mozambique also has a lot of gas and they are looking into gas to liquids and their plant would supply more than the country’s demand.
Equally, converting coal to liquids is a capital intensive undertaking that will make government think twice especially at a time when treasury is experiencing declining revenues from mining and other sources.
“It is capital intensive (and) there is huge start up costs,” he revealed. It is estimated that a gas to liquids plat could cost over P3 billion and additional P1billion for a coal to liquid plant as gas is less expensive. The project can also face environmental concerns, but Mokgatlhe said modern technology can be used to mitigate against such and reduce the impact.
However, Mokgatlhe says there is still a lot of work to be done by different stakeholders as the country mulls gas to liquid opportunities.