17 May 2013

Coal developer, Hodges Resources, which is listed in the Australian Securities Exchange, has secured 75 per cent shareholding in the Morupule south coal project, a statement from the company’s website has said.

In a press statement, the company says it has completed the earn-in agreement with SDNP Manufacture Mining and Construction Services. Under the terms of the agreement, Hodges has earned 75 per cent of the project by paying SDNP US$500 000 on the execution of the agreement and spending US$3 million in exploration over a two-year period.

The statement also explains that the companies would now incorporate a special propriety company in Botswana. After that, Hodges can exercise its option to acquire an additional 24 per cent in the joint venture company.

It further states that Hodges recently completed a 2 500m drilling programme over the shallow coal area within the eastern block of the project, which completed the outstanding expenditure commitment for the joint venture.

Hodges managing director, Mr Mark Major said the company was happy with reaching this milestone as well as the projects progress and exploration thus far.

“It is clear we have a sizeable asset with low cost operational and capital development opportunities in a developing region. The area is becoming more active with government tendering for the refurbishment of the Morupule A Power Station and announcing a request for prequalification from independent power producers for a 300MW power development next to the nearly completed Morupule B Power Station (600MW), all of which will be less than 8km from our the proposed mine,” he said.

Mr Major also added that developments in the rail haulage were also afoot with Transet Freight Rail, adding that it planned to open the rail link for the Waterberg area into Botswana by 2020, during the Southern Africa coal conference recently.

He highlighted that it was also known that Morupule Coal mine reached an agreement with Botswana Railways and Transnet to commence carrying coal to the Durban port in South Africa to supply international markets.

Hodges also intends to move the Morupule South project forward in line with the regional development and was currently working towards feasibility level studies. The Morupule South coal project is located within the eastern Central District of Botswana, adjacent to the Morupule Mine and Colliery, the only operational coal fired power plant in the country.

To date, Hodges has drilled 107 holes for 12 073 meter. The company has also undertaken scoping level mining and power integration studies which confirmed the technical and financial viability of the project. ENDS