(EnergyAsia, February 14 2013, Thursday) — Australian miner Hodges Resources Limited said it expects to advance a major coal project in Botswana to the feasibility phase following the positive outcome of recent mine scoping and power integration studies.

Declaring itself “extremely pleased with the outcome” of the studies, Hodges said the feasibility phase studies will target the Morupule South project to initially produce between two and three million tonnes per year, rising to five million t/y within five years.

The studies have also determined that there is sufficient electricity demand to support the integration of the small scale power plant at Morupule South that will create an immediate market for the mine’s product given its proximity to an existing grid.

Managing director Mark Major said that the scoping study has delivered significant independent information that confirms the technical viability of mining the Morupule coal basin and opening it to “a number of economically sound development options.”

He said: “The low mining costs and the coal’s physical properties allows Hodges the luxury of looking at various project development options going forward.”

The studies have also identified areas where additional operational and possible capital cost savings could be achieved.

“Despite having the resources to support this, a run of mine production scenario of 20 million tonnes/year has not been considered appropriate at this stage until developments are made to the existing rail and port infrastructure,” Mr Major said.

The company will instead focus on the feasibility of an initial stage of operation requiring less capital and supporting an operation for the domestic and regional coal markets in southern Africa.