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Tlou Energy share prices soar over 35% following material upgrade
Tlou Energy's share prices jumped over 35% on Tuesday after it announced that its 2P and 3P coal bed methane (CBM) reserves have seen a material upgrade following assessment.
Bruce McConachie of independent international specialized consultancy group SRK, who specialise in petroleum studies and petroleum-related projects, upgraded the company's reserves with the 2P reserves increasing 944% to 40.8bn cubic feet and the 3P reserves rising 63% to 426.6bn cubic feet.
The reserves have been attributed to Tlou's 100% interest in the Lesedi and Mamba project permits.
Tony Gilby, managing director of Tlou Energy, said: "This very significant upgrade in gas Reserves reinforces the commerciality of the Lesedi and Mamba Projects. The recent seismic survey and core-hole drilling campaign, along with the Selemo pilot wells producing sustained gas flows for a substantial period of time, confirms that there is huge gas production potential for Tlou's area."
The company is working to assess the potential of the reserves, as well as working towards a connection to the regional power grid.
"This Reserves upgrade provides continued confidence for the company to invest in additional appraisal activities aimed at further increasing certified gas reserves. Adding reserves, and planning for grid connection, reinforces the Company's objective to become the first company to sell power generated by CBM gas in Botswana," said Gilby.
The company, founded in 2009, aims to alleviate Botswana's reliance on importing power and tackling its energy crisis by utilising domestic gas to produce power.
As of 1230 GMT, Tlou Energy's shares were up 37.88% to 11.72p.