Strata-X Energy has announced that it has signed a heads of agreement with Magnum Gas and Power for a farm-in to get up to 75% of the Serowe Coal. Seam Gas (CSG) project is located on the Kalahari Basin CSG Fairway in Botswana.

The legally binding long form agreements regarding the farm-in to the Serowe CSG Project are expected to be concluded and signed between the parties within the next 2 weeks. Under the agreements, US-based, Strata-X will operate the Project, which covers about 273,000 acres and has certified 1075 Petajoules (PJ) of recoverable Prospective Resource.

The planned farm-in is in three stages and Strata-X has about 3 years to complete all stages, with each stage getting the company a 25% working interest in the Serowe CSG Project. Stage 1 is to commence in January 2017 and will include the desorption analysis of 3 CSG core wells necessary for continuous gas resource certification. Furthermore, one well will be completed and tested.

The Stage 1 is estimated to cost A$1.1 million while Stages 2 and 3 are optional and the decision to advance to these stages will be subject to the results of the previous stage. Stages 2 and 3 are estimated to cost about A$1.5 million and A$3.5 million respectively, conditional on the success of new completion and production methods to be tested, Energy-pedia reports.

The last working interest would be earned when 100 PJ of 2P reserves are certified for the project, which is an adequate quantity of gas for a Gas Sales Agreement (GSA) to supply a 50-megawatt corporation power station owned by the government, which might be located near the Serowe CSG Project.

Anita Fatunji