The company earned a greater interest in the project by paying SDNP Manufacture Mining and Construction Services $US500,000 on execution of the agreement and spending $3 million over two years on the project.

The companies will now incorporate a propriety company in Botswana that will hold the permit, and Hodges has the right to acquire an additional 24% in the joint venture company once this is complete.

A recently completed 2500m drilling program was the final expenditure commitment for the joint venture.

Hodges managing director Mark Major said the company was extremely happy with reaching this milestone as well as the project’s progress and exploration.

“It is clear we have a sizeable asset with low-cost operational and capital development opportunities in a developing region,” Major said.

The project sits adjacent to the Morupule mine and colliery, the only operational coal fired-power plant in Botswana.

The government of Botswana recently closed a tender for refurbishment of the 132MW Morupule A station, recently developed a 600MW Morupule B power station and has requested expressions of interest for a third 300MW power station to be built by 2017.

Major said the area was becoming more active with the government’s power station tendering and would provide over 1000MW of power “less than 8km from our proposed mine”

He said developments in the rail haulage were also underway, with South African freight rail company Transnet Freight Rail revealing plans this week to open the rail link for the Waterberg area into Botswana by 2020.

“It is also known that recently, our neighbours the Morupule Coal Mine reached an agreement with

Botswana Railways and Transnet to commence carrying their coal to the Durban port in South Africa to supply international markets” he said.

A strategic meeting is planned for later in the month between major stakeholders and government bodies to plan the development of the rail line.

The company said it intended to move the Morupule South project forward in line with the regional development and is currently working towards feasibility level studies.

The site’s drilling program consisted of 107 drill holes and defined a 2.45 billion tonne JORC compliant resource, of which 110Mt is measured, 173MT is indicated and 2,167Mt is inferred.

Hodges Resources Limited was incorporated in 2005 and is listed on the Australian Securities Exchange, with its head office in Perth, Western Australia. Hodges acquired the Morupule South coal project in central east Botswana in 2011.