Tlou Energy, a company focused on delivering power in Botswana and southern Africa through the exploration and development of gas, solar and hydrogen, has released its hydrogen strategy.
To supplement the company’s gas-to-power initiative, Tlou has devised a hydrogen strategy. The hydrogen economy is quickly evolving, and it has the potential to bring up a plethora of new business opportunities in areas such as solid carbon products, oxygen, and ammonia for energy storage, fuel cell electric vehicles (FCEV), agricultural, and medicinal uses.
Tlou is well-positioned to manufacture hydrogen using a variety of methods. To produce these items, the company has extensive and well-proven resources. Methane for carbon and hydrogen, freely available water for hydrogen and oxygen, and nearly limitless CBM/solar electricity to power the process. Tlou’s comprehensive permits to date, including environmental, gas, and solar generation licenses, access to land, and proven in-country operational competence, would help a hydrogen strategy.
Lesedi project finance and Power Purchase Agreement (PPA)
Tlou is currently in talks with a number of parties about a $10 million project finance package for the first phase of the Lesedi gas-to-power project, which involves the building of transmission lines and substations.
Two of these companies are now going through internal approval processes and have not expressed a clear requirement to complete the 10MW PPA in order to go forward. Others have expressed a desire for the 10MW PPA to be completed before proceeding. Tlou has no control over these third-party internal processes and hence cannot predict how long they will take. Significant work on the transmission lines and substation can begin once a project finance package is in place and it is commercially prudent.
Confidential discussions on the 10 MW PPA are ongoing, and progress is being made. The company’s major goal is to move the Lesedi gas-to-power project forward. The development of hydrogen is anticipated to run concurrently and, given the availability of Tlou’s gas and solar electricity, might develop into a lucrative possibility for the company over time.