Botswana is planning to construct a $2.5 billion plant to convert coal into liquid fuels as the country seeks to reduce is dependence on imported fuel.

This is according to an announcement by a state oil company official on Monday.

As it stands, Botswana imports all of its liquid fuels via South Africa, which regularly results in shortages stemming from logistical issues.

Operating within a public-private partnership, the plant will produce 12,000 barrels of diesel and gasoline a day, over a three-decade lifespan.

“The project has been approved for procurement and production will primarily be for the local market," Botswana Oil senior manager responsible for new ventures, Gamu Mpofu, stated.

Botswana has coal reserves of some 212 billion tonnes, but imports all of its fuel requirements, approximately 7.5 million barrels per year.

Moreover, Sasol in South Africa runs the largest coal-to-liquids plant in the world and is committed to move from coal and hit net zero emissions by 2050. Yet Botswana is looking to make the most of its coal reserves to industrialise the economy.

“There is a case for using coal to produce fuel for Botswana and it will be done within the environmental considerations that the country has signed up to with various stakeholders," Mpofu added.

Fuel prices in Botswana have risen a number of times so far this year, hitting record highs, as the country bears the impact of high oil prices across the globe fuelled by the war in Ukraine.