Kinetiko Energy (ASX: KKO) has entered into a MOU for a joint venture agreement with White Rivers Exploration for gas appraisal in the Karoo Basin coalfields of South Africa.

White Rivers Exploration has extensive coal and gold holdings in the country, and is a certified Black Economic Empowerment entity.

The MOU covers three Technical Co-operation Permit areas, at Heilbron, Kroonstadt and Ventersburg, all known to contain coal measures at depth.

Widespread methane and helium gas have been encountered in nearby coal and mineral bore holes.

The helium is thought to be derived originally from radioactive uranium decay, whilst the methane is derived from the extensive Karoo coal measures.

The helium has then migrated upwards into the Karoo methane gas traps.

As with Kinetiko’s Amersfoort project it is also expected that coal derived methane will also be found in conventional sandstone reservoirs.

Kinetiko will be the operator and hold a 50% interest in the JV, with parties contributing in proportion to their interest.

White Rivers retains the coal exploration rights underlying the onshore gas permits subject to this agreement.