Zimbabwe has granted coal bed methane (CBM) special grants to six investors in Matabeleland North province as it seeks to tap into cleaner fuel for electricity generation, a move which has been cheered by climate advocates who view the development critical in efforts to curb climate change.
Among the companies that have been granted CMB concessions are Tumagole of South Africa, Sakunda Holdings and Shangani Energy Exploration (SEE), which is owned by Chinese steel giant, Sinosteel.
“About six companies have so far been granted licence to explore coal bed and the Lupane, Gwayi and Hwange region could become a major investment attraction in the country,” an official in the Ministry of Mines and Mining Development said, but refused to be identified because he is not allowed to talk to the press.
Zimbabwe is said to have huge deposits of untapped coal bed methane gas in the Hwange, Lupane and Gwayi areas, but their commercial viability has not yet been supported by geological information.
Over the years, drilling and desorption tests have been conducted and resources that run into trillions of cubic feet have been discovered, according to Government’s geological department. Tumagole indicated that it would invest as much as R55 billion in extracting methane gas in Zimbabwe and was awaiting binding contracts to proceed.
SEE has earmarked US$780 million to build a 600 megawatt power station and petrochemical related industries. Sakunda said it would first seek geological information which would then inform on business they would conduct.
Zimbabwe launched a roadmap that seek to propel the mining sector to a US$12 billion industry by 2023 described by some critics as ambitious and too unrealistic.
Zimbabwe is currently in the initial production testing of coal bed methane with view of generating power.
In addition to power generation, an integrated petrochemical industry can be established with potential to attract offshore capital and create employment.
Mining analyst have noted there was a lot of work that needs to be done both technically and commercially. Besides, the country still needs to craft a gas policy to regulate the new sector.
“There is gas potential in parts of the Lupane — Hwange basin,” Fred Moyo, a renowned mining engineer and former deputy minister of Mines said.
“We need exploration which is highly technical. The gas policy is also important because investors can’t move without it. Market and infrastructure also need careful assessments. So yes it’s a good sector with good potential but needs to be undertaken carefully from a technical, regulatory and commercial perspective.”
Some local climate advocates cheered the development as a victory for the environment because when used for electricity generation, CBM is much cleaner compared to thermal.
However, there is no real scientific consensus on the environmental impact of coal-bed methane gas. Some say methane has a higher potential of causing climate change while others argue that when burnt to produce electricity, methane is a lot cleaner compared to coal.
Zimbabwe, which currently generates about half of its electricity from coal with a number of thermal projects lined up for implementation, is holding in check the use of coal for power production in line with its pledge to reduce carbon footprint.
Zimbabwe is a signatory to the Paris climate change accord agreed in 2015, which seeks to hold the increase of the global average temperature to below 2 degrees Celsius.- www.ebusinessweekly.co.zw