REG - Tlou Energy Ltd - Quarterly Activities Report q/e 31 March 2024
26/04/2024 07:00
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RNS Number : 1190M Tlou Energy Ltd 26 April 2024
26 April 2024
Tlou Energy Limited
("Tlou" or "the Company")
Quarterly Activities Report for the quarter ended 31 March 2024
Highlights
Ø Construction of the 66kV transmission line connecting Tlou's Lesedi project
directly to Botswana's power grid and the broader Southern African Power Pool
has been completed
Ø The substation to connect Tlou's power generators to the transmission line
is approximately 50% complete
Ø Gas gathering lines being laid to connect Tlou's gas wells to the
generation site
Ø Continued gas production at the Lesedi 4 and Lesedi 6 production pods
Ø Preparations underway for further production pod drilling with drilling rig
secured
Activities
Tlou Energy has three project areas referred to as the:
§ Lesedi Project - focused on gas-to-power development as well as exploration
and evaluation.
§ Mamba Project - focused on exploration and evaluation.
§ Boomslang Project - focused on exploration and evaluation.
Lesedi Project
The Lesedi project is Tlou's most advanced. The Lesedi project remains at the
forefront of Botswana's gas to power sector, making substantial progress in
the development of the proposed 10MW gas-to-power project.
Gas to Power Project
The initial electricity produced at Lesedi is intended to fulfill the 10 MW
Power Purchase Agreement (PPA) with Botswana Power Corporation (BPC), the
national power utility. The ongoing Lesedi project involves various
development components, including drilling of gas production wells,
transmission lines, substations, gas gathering and a power generation site.
Gas production and gathering
The Company has two gas production pods, Lesedi 4 and Lesedi 6. Both pods
continue to flow gas as the water level is being lowered.
Tlou is confident that with the in-house knowledge gained from previous
drilling efforts, extracting more and more gas out of the coal reservoir will
become progressively simpler and more cost effective due to economies of
scale.
Work on the gas gathering lines commenced during the quarter. This involves
laying of pipe to take gas from the wells to the generation site.
Preparatory work for the next drilling campaign has also begun. The Company
has secured a drilling rig and discussions are ongoing with relevant suppliers
and specialist drilling personnel.
In addition, some minor changes to drilling techniques are being assessed with
the aim of further increasing gas production rates.
Transmission Line Construction
To connect to the national grid, the Company constructed a 100km 66kV
transmission line to tie in with the existing power grid. Construction of the
transmission line has been completed by the contractor. Minor finishing works
and the addition of switchgear at the Serowe end will be done prior to the
line being energised. The line is planned to remain under care and maintenance
until energisation which is expected later this year.
Substation Construction
In addition to the transmission line, an electrical substation is required at
the Lesedi end of the transmission line. At the opposite end the line has been
connected to the existing BPC substation at Serowe. The substation at Lesedi
has being designed to facilitate expansion beyond 10MW which will be
beneficial as the projects grows. The Lesedi substation is approximately 50%
complete. It is currently anticipated that this work will be completed in Q3
2024.
Lesedi project licences
The project area has four Prospecting Licenses (PL) and a Production Licence
which is the focus area for the development of Tlou's independently certified
gas reserves and contingent resources. The table below summarises the status
of the Lesedi licences:
Licence Expiry Status
Production Licence 2017/18L Aug-42 Current
PL001/2004 Mar-26 Current
PL003/2004 Mar-26 Current
PL035/2000 Mar-25 Current
PL037/2000 Mar-25 Current
****
Mamba Project
The Mamba project is in the exploration and evaluation phase with further
operations required on the licences. It consists of five Prospecting Licences
covering an area of approximately 4,500 Km(2). The Mamba area is situated
adjacent to Lesedi. In the event of successful drilling results at Mamba, it
is envisioned that this area would be developed as a separate project from
Lesedi. The Mamba area provides the Company with flexibility and optionality.
The status of the Mamba licences is as follows:
Licence Expiry Status
PL 237/2014 Dec-25 Current
PL 238/2014 Dec-25 Current
PL 239/2014 Dec-25 Current
PL 240/2014 Dec-25 Current
PL 241/2014 Mar-26 Current
Further work on the Mamba project is proposed once the Lesedi project is in
production with initial work likely to include a seismic survey and the
drilling of core-holes.
****
Boomslang Project
Prospecting Licence, PL011/2019 designated "Boomslang", is approximately 1,000
Km(2) and is situated adjacent to the Company's existing licences. To date,
the Company has not carried out ground operations in the Boomslang area. Like
the Mamba project the first stage of operations is likely to include a seismic
survey following by core-hole drilling.
The status of the Boomslang licence is as follows:
Licence Expiry Status
PL 011/2019 Jun-24 Current
PL renewal applications are submitted three months prior to expiration. During
the reporting quarter a renewal application for PL011/2019 was submitted.
****
Cash Position
At the end of the quarter the Company had ~A$5.98m cash on hand (unaudited).
The aggregate value of payments to related parties and their associates of
A$120k for the quarter (shown in item 6.1 of the Quarterly Cashflow Report)
relates to directors' salaries and fees (including tax and superannuation
payments made on their behalf) and office rent.
The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK
law by virtue of the European Union (withdrawal) Act 2018. The information is
disclosed in accordance with the Company's obligations under Article 17 of the
UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.
By Authority of the Board of Directors
Mr. Anthony Gilby
Managing Director
****
For further information regarding this announcement please contact:
Tlou Energy Limited +61 7 3040 9084
Tony Gilby, Managing Director
Solomon Rowland, General Manager
Grant Thornton (Nominated Adviser) +44 (0)20 7383 5100
Harrison Clarke, Colin Aaronson, Ciara Donnelly
Zeus Capital (UK Broker) +44 (0)20 3829 5000
Simon Johnson
Investor Relations
Ashley Seller (Australia) +61 418 556 875
FlowComms Ltd - Sasha Sethi (UK) +44 (0) 7891 677 441
About Tlou
Tlou is developing energy solutions in Sub-Saharan Africa through gas-fired
power and ancillary projects. The Company is listed on the ASX (Australia),
AIM (UK) and the BSE (Botswana). The Lesedi Gas-to-Power Project ("Lesedi") is
100% owned and is the Company's most advanced project. Tlou's competitive
advantages include the ability to drill cost effectively for gas, operational
experience and Lesedi's strategic location in relation to energy customers.
All major government approvals have been achieved.
Forward-Looking Statements
This announcement may contain certain forward-looking statements. Actual
results may differ materially from those projected or implied in any
forward-looking statements. Such forward-looking information involves risks
and uncertainties that could significantly affect expected results. No
representation is made that any of those statements or forecasts will come to
pass or that any forecast results will be achieved. You are cautioned not to
place any reliance on such statements or forecasts. Those forward-looking and
other statements speak only as at the date of this announcement. Save as
required by any applicable law or regulation, Tlou Energy Limited undertakes
no obligation to update any forward-looking statements.
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
Tlou Energy Limited
ABN Quarter ended ("current quarter")
79 136 739 967 31 March 2024
Consolidated statement of cash flows Current quarter Year to date (9 months)
$A'000
$A'000
1. Cash flows from operating activities
1.1 Receipts from customers
1.2 Payments for
(a) exploration & evaluation
(b) development
(c) production
(d) staff costs (235) (786)
(e) administration and corporate costs (200) (1,164)
1.3 Dividends received (see note 3)
1.4 Interest received 1 12
1.5 Interest and other costs of finance paid
1.6 Income taxes paid
1.7 Government grants and tax incentives
1.8 Other (provide details if material) (20) 114
1.9 Net cash from / (used in) operating activities (454) (1,825)
2. Cash flows from investing activities
2.1 Payments to acquire or for:
(a) entities
(b) tenements
(c) property, plant and equipment (983) (1,110)
(d) exploration & evaluation (1,178) (9,290)
(e) investments
(f) other non-current assets
2.2 Proceeds from the disposal of:
(a) entities
(b) tenements
(c) property, plant and equipment
(d) investments
(e) other non-current assets
2.3 Cash flows from loans to other entities
2.4 Dividends received (see note 3)
2.5 Other (provide details if material)
2.6 Net cash from / (used in) investing activities (2,160) (10,399)
3. Cash flows from financing activities 7,355 7,920
3.1 Proceeds from issues of equity securities (excluding convertible debt
securities)
3.2 Proceeds from issue of convertible debt securities
3.3 Proceeds from exercise of options
3.4 Transaction costs related to issues of equity securities or convertible debt (13) (77)
securities
3.5 Proceeds from borrowings 570 3,570
3.6 Repayment of borrowings
3.7 Transaction costs related to loans and borrowings
3.8 Dividends paid
3.9 Other (provide details if material) (14) (14)
3.10 Net cash from / (used in) financing activities 7,898 11,399
4. Net increase / (decrease) in cash and cash equivalents for the period
4.1 Cash and cash equivalents at beginning of period 730 6,851
4.2 Net cash from / (used in) operating activities (item 1.9 above) (454) (1,825)
4.3 Net cash from / (used in) investing activities (item 2.6 above) (2,160) (10,399)
4.4 Net cash from / (used in) financing activities (item 3.10 above) 7,898 11,399
4.5 Effect of movement in exchange rates on cash held (38) (50)
4.6 Cash and cash equivalents at end of period 5,976 5,976
5. Reconciliation of cash and cash equivalents Current quarter Previous quarter
at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts
$A'000
$A'000
5.1 Bank balances 5,976 730
5.2 Call deposits
5.3 Bank overdrafts
5.4 Other (provide details)
5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above) 5,976 730
6. Payments to related parties of the entity and their associates Current quarter
$A'000
6.1 Aggregate amount of payments to related parties and their associates included 120
in item 1
6.2 Aggregate amount of payments to related parties and their associates included
in item 2
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity
report must include a description of, and an explanation for, such payments.
7. Financing facilities Total facility amount at quarter end Amount drawn at quarter end
Note: the term "facility' includes all forms of financing arrangements available to the entity.
$A'000
$A'000
Add notes as necessary for an understanding of the sources of finance available to the entity.
7.1 Loan facilities 1,000 480
7.2 Credit standby arrangements
7.3 Other (please specify)
7.4 Total financing facilities 1,000 480
7.5 Unused financing facilities available at quarter end 520
7.6 Include in the box below a description of each facility above, including the
lender, interest rate, maturity date and whether it is secured or unsecured.
If any additional financing facilities have been entered into or are proposed
to be entered into after quarter end, include a note providing details of
those facilities as well.
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8. Estimated cash available for future operating activities $A'000
8.1 Net cash from / (used in) operating activities (item 1.9) 454
8.2 (Payments for exploration & evaluation classified as investing activities) 1,178
(item 2.1(d))
8.3 Total relevant outgoings (item 8.1 + item 8.2) 1,632
8.4 Cash and cash equivalents at quarter end (item 4.6) 5,976
8.5 Unused finance facilities available at quarter end (item 7.5) 520
8.6 Total available funding (item 8.4 + item 8.5) 6,496
8.7 Estimated quarters of funding available (item 8.6 divided by item 8.3) 4.0
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7.
8.8 If item 8.7 is less than 2 quarters, please provide answers to the following
questions:
8.8.1 Does the entity expect that it will continue to have the current
level of net operating cash flows for the time being and, if not, why not?
Answer:
8.8.2 Has the entity taken any steps, or does it propose to take any
steps, to raise further cash to fund its operations and, if so, what are those
steps and how likely does it believe that they will be successful?
Answer:
8.8.3 Does the entity expect to be able to continue its operations and
to meet its business objectives and, if so, on what basis?
Answer:
Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2
and 8.8.3 above must be answered.
Compliance statement
1 This statement has been prepared in accordance with accounting
standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters
disclosed.
Date:
.....26/04/2024...............................................................
Authorised by: ....By the
Board.............................................................
(Name of body or officer authorising release - see note 4)
Notes
1. This quarterly cash flow report and the accompanying
activity report provide a basis for informing the market about the entity's
activities for the past quarter, how they have been financed and the effect
this has had on its cash position. An entity that wishes to disclose
additional information over and above the minimum required under the Listing
Rules is encouraged to do so.
2. If this quarterly cash flow report has been prepared in
accordance with Australian Accounting Standards, the definitions in, and
provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and
AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash
flow report has been prepared in accordance with other accounting standards
agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent
standards apply to this report.
3. Dividends received may be classified either as cash flows
from operating activities or cash flows from investing activities, depending
on the accounting policy of the entity.
4. If this report has been authorised for release to the
market by your board of directors, you can insert here: "By the board". If it
has been authorised for release to the market by a committee of your board of
directors, you can insert here: "By the [name of board committee - eg Audit
and Risk Committee]". If it has been authorised for release to the market by a
disclosure committee, you can insert here: "By the Disclosure Committee".
5. If this report has been authorised for release to the
market by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance Council's
Corporate Governance Principles and Recommendations, the board should have
received a declaration from its CEO and CFO that, in their opinion, the
financial records of the entity have been properly maintained, that this
report complies with the appropriate accounting standards and gives a true and
fair view of the cash flows of the entity, and that their opinion has been
formed on the basis of a sound system of risk management and internal control
which is operating effectively.
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