Tlou Energy (ASX: TOU) is looking to bring southern African unconventional gas exposure to the ASX, with the company currently in the IPO process - with a proposed listing date on the 28th March 2013.
The offer includes 20 million shares at $0.50 to raise $10 million, and if this full amount of shares are allocated then the company will have around 103 million shares on offer post the offer - providing a market cap. of $51 million if the company first trades at the IPO price.
Adding some potential to the company's plans, historical exploration in the region has delineated multiple coal basins that are highly prospective for unconventional gas.
Tlou’s principal assets are located in Botswana, a country with a relatively stable fiscal regime and low corruption index for Africa, with the company targeting new energy sources - such as coalbed methane (CBM) to be developed and commercialised.
Assets span a vast area
In total, Tlou has nine CBM Prospecting Licenses in the Karoo Central and Karoo West areas of Botswana which cover an extensive 7000 square kilometres.
The Karoo Central and Karoo West CBM tenements are located in the Karoo-Kalahari basin, where the company has been active for over three years with a total of around US$40 million having been invested on drilling and testing programs Tlou - and the previous operator Saber Energy.
The Karoo Central project is one of the most progressed CBM projects in southern Africa. This project has been assessed by resource certifiers Netherland, Sewell & Associates, Inc. (NSAI) as containing Contingent Resources of 2.3TCF (3C), with a further Prospective Resource totalling 8.6TCF (High Estimate).
Tlou is positioned to increase its exposure to prospective CBM acreage through a pending application with the Botswana government.
The company also has an interest in two CBM Special Grants and a further application in Zimbabwe with a total area of around 3000 square kilometres.
Australian majors eye Botswana
Australian CBM industry leader Origin Energy and other regional majors including Exxaro and Sasol have also taken sizeable CBM positions in Botswana, establishing Botswana as an emerging unconventional gas province.
Tlou brings in-country experience
An important factor Tlou has which is essential in progressing project's in Africa is an eperienced in-country management team, in conjunction with a local operating workforce.
This includes Anthony (Tony) Gilby who will be the CEO of Tlou, and was a pioneer in Queensland’s CBM industry having co-founded and led Sunshine Gas Limited (formerly ASX listed), a company that proved +1,000PJ of CBM reserves and was sold to QGC/BG for around A$1.1 billion.
Along with Gilby, Tlou was co-founded with Nathan Mitchell will act as chairman.
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