19 Jul 2016

Government has set up a team of five cabinet ministers to look into copper and nickel mine BCL business and possible options of safeguarding other parts of the economy with prospects for growth.

In an interview last week the Minister of Minerals, Energy and Water Resources Mr Kitso Mokaila explained that after recollecting all necessary information about the mine’s operations and its business model his ministry approached cabinet and advised that there were only three options left to address the unusual state of the mine’s business.

 “As a ministry we approached cabinet concerning BCL and looking at record low nickel prices worldwide. We advised cabinet that there were three options left that needed utmost attention because they will not be easy decisions. Should government reinvest? How much cash to be injected into the mine what this means to other parts of the economy? The second option was to consider placing the mine under care and maintenance while lastly there could be a chance of shutting down operations at the mine and assess what impact that could have on BCL business partners and employees,” he said.

Mr Mokaila quashed as baseless and half-baked commentary from the media that government had failed to provide a bailout plan to assist the nickel mining operations in Selebi Phikwe. 

He said he chairs a committee comprising of Minister of Finance and Development Planning Mr Kenneth Matambo, Minister of Environment, Wildlife and Tourism Mr Tshekedi Khama, Minister of Investment Trade and Industry Mr Vincent Seretse and Minister of Infrastructure, Science and Technology Mr Nonofo Molefhi.

“I must admit it’s a very difficult decision to make with our current financial status as a country. In the past when we had a sound economy we could have simply considered cash injection with hope of making decent returns but now any decision on one part of the economy can adversely affect other parts. The decision will be made by government and the announcement will be made,” he said.

Mr Mokaila noted that government was working round the clock and making all the necessary consultations. 

He assured the nation that within the three weeks’ time frame they have been given to present their findings they would have explored all the options. 

He said they have engaged other stakeholders such as Bank of Botswana and Botswana Institute for Development Policy Analysis (BIDPA) to assist with relevant expertise.

In a recent BCL Business Reorganisation press conference in Gaborone held under the theme “BCL is still a viable business,” BCL’s managing director Mr Dan Mahupela echoed minister Mokaila’s comments that negative media speculations about the future of the mine had the potential to cause anxiety among BCL employees and further jeopardise viable alternatives to grow business.

He explained that the current financial situation at the mine was a result of market forces and other factors that conspired to deprive the mine of its projected revenue and of pursuing the ambitious strategic intentions under Polaris II.

The Polaris II is a component of the broader BCL strategy that covers a 20 year period from 2013 to 2033. 

The promulgation of Polaris II was achieved through the creation of a holding company with subsidiaries operating within defined themes such as expanding and sustaining nickel production circuit amongst others.

BCL is a major strategic position in the Botswana economy particularly the Selebi Phikwe Economic Diversification Unit (SPEDU) Region. 

The company has about 4 300 direct employees.

 Government owns 100 per cent shares of the mine. ENDS