Upstream & Gas Systems

BOTSWANA’S CBM INVESTMENT LANDSCAPE

ThemeUpstream & Gas Systems

Country / RegionBotswana

Year2026

AuthorsOpetunde Diaro

Summary

Botswana’s coal-bed methane (CBM) sector remains pre-commercial but has advanced materially since 2024–2025. The dominant near-term project is Botala Energy’s Serowe CBM Project in central Botswana. In September 2026 the company reported early continuous gas flow at the Pitse Pilot well Serowe-3.5B, with production beginning significantly earlier in the dewatering process than expected (Botala Energy, 2026a). The project holds a mining licence, environmental approvals, a binding letter of intent for LNG offtake with South Africa’s Scaw Metals for up to 3.5–4.7 petajoules (PJ) per year, and a non-binding government equity commitment of approximately BWP 35 million (? A$4 million / US$3.6–4 million) via the Minerals Development Company Botswana (MDCB) for a 15% project stake plus a 1% LNG royalty (Botala Energy, 2025a; Sunday Standard, 2025).
Botala targets a final investment decision (FID) in the second half of 2026 and first LNG production around end-2026 or 2027. Tlou Energy’s Lesedi gas-to-power project remains the other principal development, supported by certified reserves and resources, a 10 MW Power Purchase Agreement (PPA) with the Botswana Power Corporation (BPC), and grid-connection infrastructure (Tlou Energy, n.d.). Kalahari Energy continues to hold licences but publishes limited current operational detail.
On a basin scale, the U.S. Geological Survey estimated a mean of 4.5 trillion cubic feet (Tcf) of undiscovered, technically recoverable coalbed gas across the Kalahari Basin Province (Botswana, Zambia and Zimbabwe) (U.S. Geological Survey, 2017). Company figures for specific acreage are higher on a prospective basis: Botala reports 2C contingent resources of 454 billion cubic feet (Bcf) and prospective resources of approximately 7.1 Tcf (best estimate) following a 2024 Sproule recertification (Botala Energy, 2024). Tlou reports 2P reserves of 40.8 Bcf, 3P reserves of 426.6 Bcf and 2C contingent resources of 214 Bcf (Tlou Energy, n.d.).
Key trends include growing state equity participation, modular LNG and gas-to-power pathways designed to address domestic power deficits and Southern Africa’s emerging gas shortfall, and regulatory clarification of CBM under the amended Mines and Minerals Act. Constraints remain high capital intensity, limited pipeline and processing infrastructure, offtake certainty beyond initial agreements, and the requirement to convert contingent resources into reserves via sustained commercial flow rates.
The most significant near-term intelligence indicators are Botala’s extended flow-test results and independent resource-to-reserve conversion, FID and financing close, progress on any BPC CBM pilot tenders, and Tlou first-generation milestones.

Key Messages

Botswana’s CBM sector is moving toward commercialization, led by Botala Energy’s Serowe project, which has recorded early continuous gas flow.
Serowe is the key near-term development, with LNG offtake arrangements, government equity participation and an FID targeted for H2 2026.
Gas-to-power and LNG exports are the main monetization routes, with Tlou Energy’s 10 MW project providing a parallel domestic gas-to-power pathway.
Botswana has significant CBM potential, with basin-wide estimates running into several trillion cubic feet, although much of the resource remains prospective or contingent.
Commercialization still depends on proving sustained production, securing financing and offtake, and overcoming infrastructure and processing constraints.

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