Mmamabula

Location & Landholdings

Jindal’s coal resource is located in the Mmamabula Coalfields of south-eastern Botswana, adjacent to the country’s main road and rail corridor which links the country’s capital, Gaborone, with its second largest city, Francistown.

The Mmamabula Coalfields form the western extension of South Africa’s Waterberg Coalfield, which contains approximately forty percent South Africa’s coal resources, along with Eskom’s 3,690 MW (net capacity) Matimba power station and Exxaro Resources Limited’s 19 million sales tonnes per annum Grootegeluk coal mine.  Exxaro has also been contracted to supply a further 14 million tonnes per annum to Eskom’s 4,800 MW Medupi power station, now under construction.

The two prospecting licences, RL2009/1R (also referred to as the Central Block), and PL11/2004 (divided into the Eastern and Western Blocks) are 100% owned by Jindal’s subsidiaries. Both Retention Licences were converted into Mining License ML2014/9L successfully. The total area for the Mining License is 313 square kilometers (km2).

The 1.3 million tonne per annum (mtpa) mine that will support the planned 300 (Net) MW Jindal Mmamabula Energy Proejct  (“JMEP I”) will be located in the Western Block (PL11/2004) and will utilize about one-third of this block.

Geology, Exploration & Mineral Resources

Since commencement of exploration by mid-2005, up to twelve drill rigs have been active concurrently on Mmamabula Coal Field. In excess of 165,000 metres have been drilled in approximately 2,000 holes and the exploration drilling program is now largely complete.

In March 2011, announced mineral resource estimate to approximately 2.4 billion tonnes as per Table 1.

Table 1 – Mmamabula In Situ Mineral Resource Estimate (D1 + M2 + D2 Upper Seams: Western, Central and Eastern Blocks)

(effective date: March 31, 2011)

The three coal-bearing areas defined within Jindal’s Mmamabula  project area (Western, Central and Eastern Blocks) have drill hole spacings that are typically set at 500 metres (“m”) by 500 m or less.

Of the 2.4 billion tonnes of in situ coal at the Mmamabula Coal Field, work done by mining team indicates that the resource can potentially deliver an extractable tonnage of 1.5 billion tonnes (run of mine).  This estimate is based on applying open cast mining methods over 30% of the area and bord and pillar with pillar extraction underground mining methods for the remainder of the resource.

Based on the analysis that has been performed, Jindal anticipates that the 1.5 billion tonnes of run of mine production could yield, after beneficiation, the following coal products: 112 Mt of thermal coal suitable for domestic on-site power generation and 900 Mt suitable for thermal export coal. This product mix is based on the typical coal qualities suited for these potential markets.

The qualities and quantities of the coal products are estimates based upon the following: interpretation of geologic data obtained from drill holes and other sampling techniques, feasibility studies that derive estimates of cash operating costs based upon anticipated tonnage and grades of coal to be mined and processed, ground conditions, the configuration of the coal seams, expected recovery rates of coal from the seams, estimated sales revenues and operating costs from coal beneficiation activities, anticipated climatic conditions and other factors. No assurances can be given that the indicated qualities or quantities of coal will be produced.  In particular, any change to the quality requirements or change to the mining methods as a result of production cost inputs would impact the coal product quantities.

Based on quality and thickness, three economic coal seams have been identified as the principal economic targets at Jindal’s Mmamabula Coal Field; these are the D1, D2 Upper and M2 seams. On the main Mmamabula PL11/2004 licence, the seams are relatively flat lying and in the areas of economic interest occur at depths of less than 140 m below surface. The D1, D2 Upper and M2 seams have average mineable thickness of approximately five, three and three metres, respectively.

Coal qualities across the Mmamabula licence area are mostly suitable for thermal power generation with raw coal calorific values (“CV”) for the major seams being approximately 20.3 megajoules per kilogram (“MJ/kg”) for the D1 seam and 22.6 MJ/kg for the M2 seam. Work to date by Jindal on the M2 seam, indicates that coal qualities generally increase from west to east, with the potential for higher-quality export coal in the M2 seam of the Western and Eastern Blocks.

Based on current mining cost parameters, approximately 30% of the Mmamabula coal resource could be extracted economically by open cut mining methods and underground bord and pillar mining methods using conventional continuous miners is being planned for the remaining 70%. Alternative mining methods (such as underground long wall extraction) that could further optimize resource utilization are also being investigated.

Washability (beneficiation) tests have shown that for a large portion of the resource, it is possible to beneficiate the coal to produce an export quality coal, as well as a lower quality coal suitable for on-site power generation and/or gasification. The relatively high sulphur contents, which average 1.8 %in the raw coal, could easily be reduced to less than 1% through beneficiation.

The Jindal Mmamabula Energy Project (“JMEP I”) is a planned 300 megawatt power station and associated coal mine that is envisaged to be built at Jindal’s Mmamabula Coalfield.

The power is intended for sale to Botswana Power Corporation (“BPC”), Botswana’s national utility, as new baseload power generation is required to sustain the country’s growth.

The cost of the capital equipment and infrastructure for JMEP I is estimated at approximately US$ 1 Billion. The estimated construction time for the JMEP I is anticipated to be approximately 36 months from Financial close.

Jindal is currently considering several alternatives for the development of the JMEP I, however a decision regarding these alternatives remains pending.

Jindal’s Mmamabula Energy Project (“JMEP”), is a planned 600 megawatt (net) capacity power station and integrated coal mine project in Botswana that is intended to provide power to South Africa. This project remains the most advanced independent power producer (IPP) project that can meet the demand for new baseload capacity in South Africa in the medium term and long term under cross border arrangements.

JMEP ESIA & BFS:

• ESIA for 4×171 MW (gross) Thermal Power Plant approved by DEA.
• ESIA is been done by DigbyWells South Africa.
• BFS is been completed by Mott McDonalds in 2017.
• Water rights from Well fields received in range of 18.2 MCM.
• ESIA for Wellfields approved by DEA.
• Water Monitoring and Modelling completed by Well Field Consulting in 2017, revised and updated in 2021.

The JMEP is being developed in accordance with the Equator Principles, a voluntary set of guidelines based on the International Finance Corporation’s (“IFC”) environmental and social standards. The IFC is the private sector arm of the World Bank Group and these standards are considered best practice for projects in developing countries. Project comply with all OECD guidelines for environment standards.