Tlou Energy Limited, the ASX, AIM and BSE listed company focused on developing gas-to-power projects in southern Africa using coal bed methane (“CBM”) natural gas from its field in Botswana, is pleased to provide an update on drilling operations at the Lesedi CBM Project.
· Drilling at the Lesedi CBM Project is making excellent progress and is on budget;
· The second vertical well in the program ‘Lesedi 4P’ has been drilled and reached a total depth of 577m having encountered a very good target coal horizon;
· Top-hole drilling has been completed at the third vertical well ‘Lesedi 5P’;
· Top-hole drilling is progressing at the first lateral well ‘Lesedi 3A’.
Update of Drilling operations
Tlou Energy Limited is currently drilling pilot production wells at the Lesedi CBM Project (‘Lesedi’) in Botswana. If successful, these wells will form part of the Company’s initial gas-to-power project which will include installation of transmission lines and grid connection. The wells are located in close proximity to the Company’s planned central processing facility.
The wells will be drilled as ‘dual lateral pods’, comprising a single vertical production well, intersected by two lateral (or horizontal) wells. The lateral wells will be drilled through the gassy coal seam, with gas extracted from this coal produced through the vertical production well where it can be gathered and used for power generation.
Up to three pods are planned. Pod one is designated ‘Lesedi 3’ and comprises a vertical production well (‘Lesedi 3P’) and two lateral wells (‘Lesedi 3A’ & ‘Lesedi 3B’). Pod two is designated ‘Lesedi 4’ and pod three is designated ‘Lesedi 5’. Vertical production wells Lesedi 3P and Lesedi 4P have been completed. The Lesedi 5P top-hole section has also been drilled. This pod will be completed subject to results from Lesedi 3 and 4 in order to retain optionality. Following completion of the top-hole section of Lesedi 5P, drilling of the top-hole section of lateral well Lesedi 3A commenced.
The drilling program will continue over the coming weeks and into early 2019. Once all six wells for pods one and two have been drilled, these pods will be completed using a separate workover rig and surface production facilities will be installed. The wells will then begin production testing to de-water and lower the pressure in the coal seam to achieve gas flow. The Company will provide further updates as the drilling program progresses.
In October 2018 the Company submitted a response to a 100MW CBM Request for Proposal from the Government of Botswana, as outlined in the market announcement on 10 October 2018. The Company is awaiting feedback in relation to this and looks forward to providing an update to the market as soon as possible.