MDCB Moves Toward BWP 35 Million Investment in Botala’s Serowe Gas Development

MDCB Moves Toward BWP 35 Million Investment in Botala’s Serowe Gas Development. Minerals Development Company Botswana (MDCB), a state-owned enterprise under the Ministry of Minerals and Energy, has signed a non-binding term sheet to increase its potential investment in Botala Energy’s Serowe Gas Project to BWP 35 million. Botala Energy confirmed the development in an announcement released this morning.

The revised proposal represents a 40 percent increase from MDCB’s earlier investment indication and is structured across equity and royalty components. According to the terms outlined, MDCB intends to inject BWP 30 million in exchange for a 15 percent equity stake in the Serowe Coal Bed Methane (CBM) Project through Botala’s subsidiary, Botala Gas (Pty) Ltd. An additional BWP 5 million would secure a 1 percent royalty on the “Received Price” (ex-works) payable annually over a 20-year period once commercial production begins.

The funding is earmarked to support the development of Botala’s five-well Pitse Pilot, which forms part of the first phase in a four-stage plan aimed at delivering a liquefied natural gas plant capable of producing 3.5 petajoules from 108 CBM wells.

Botala Energy Chief Executive Officer, Kris Martinick, noted that MDCB’s decision to increase its proposed participation demonstrates confidence in the scale and potential of the Serowe CBM Project. He highlighted that MDCB could have opted to participate through government back-in rights tied to the project’s mining licence, but instead pursued a broader investment approach that includes the pilot and LNG development pathway.

Martinick said the investment would accelerate gas-flow testing at the Pitse Pilot and contribute to completing the bankable feasibility study for the CBM-to-LNG plan. He added that cooperation with MDCB aligns project interests with national priorities, supporting not only energy output but also employment, skills development and business activity within Botswana.

The finalisation of the transaction remains subject to further agreement between the parties.