(Ecofin Agency) - Coal Petroleum and South African private company Kumvest’s are to begin construction at their $4.2-billion coal-to-liquids (CTL) plant project in Botswana in 2016.

The project is aimed at tapping South Africa’s more than 200-billion tonnes of coal resources to reduce reliance on petroleum product imports.

According to Holland & Hausberger, technical advisers to Coal Petroleum, the 20 000 bbl/d project, which is to also produce fertilizer, will run over three phases from 2016 to 2020.

Botswana imports all its liquid fuel to feed its yearly consumption of 1.2-billion litres. The plant is to require 4.3-million tonnes per year of coal, which it will source from Morupule; Botswana's only operating coal mine.

As a matter of fact, the project, will create more than 9,000 jobs as well as have a positive $830-million impact on Botswana's balance of trade, Holland & Hausberger told Engineering news.

However, Botswana Oil Ltd has decided to buy petroleum products from the plant and is to begin discussions with funders about acquiring a stake, CE Willie Mokgatlhe said.