Research Report: Tlou Energy

Tlou Energy

Tlou Energy

Tlou Energy (Tlou) is an AIM and ASX quoted company focused on delivering power in Botswana through the development of coal bed methane (CBM) projects. It has been able to demonstrate ongoing progress with the Lesedi CBM project with it being the first company in Botswana to achieve independently certified CBM gas reserves in 2016 as well as the first to receive Environmental Impact Statement (EIS) approval. In January 2017, a request for proposal (RFP) tender was received from the Botswanan Government and in February Tlou announced it had signed Heads of Agreement (HoA) with Independent Power Corporation (IPC) as development partner for Lesedi. However, it represents a speculative investment opportunity and hence is not without risk. On 24 March 2017, the company announced it had completed a placement to raise £3.1m/A$5.2m at 6p with there being the option for Australian shareholders to participate in a Share Purchase Plan to raise up to an additional A$2m. The net proceeds along with existing cash will be used to expand the company's independently certified gas Reserves and to finalise the licensing requirments prior to development of Lesedi. Application will be made for the placing shares to be admitted to trading on AIM and the ASX and it is expected that dealings in these new shares will commence on 7 April 2017.