The Mmamantswe coal project tenement area is positioned between the major infrastructure corridor of Botswana and the South African border. Rail, power and highway links to Gaborone and South Africa pass within 30km of the coal deposit.
Under the deal, Aviva will spend $US500,000 over 18 months upon which Mawana will grant it an option to earn a 90% joint venture interest in the project after payment of $500,000 and the completion of a bankable feasibility study.
Mawana will be free carried to production on its 10% interest and will have the right to take up a further 15% on a fully funded basis.
Aviva chief executive Lindsay Reed said a 12-month exploration and development plan for Mmamantswe was being created with a drilling and quality testing program scheduled for the second quarter of 2007.
Prior to 1983, exploration drilling by BP Coal and JCI intercepted three coal seams with a combined thickness of 23m between 30m and 110m depth.
The Botswana Department of Geological Survey has published an inventory of 598 million tonnes of coal within the tenement area and puts the potential of the area at over 2 billion tonnes. Aviva said a target of 600Mt was realistic.
