06 Dec 2016

Government views the mineral sector as an opportunity for economic growth and diversification.

Delivering State-of-the-Nation Address in Parliament on Monday (December 5), President Lt Gen. Dr Seretse Khama Ian Khama said economic diversification could be undertaken through promotion of further beneficiation projects as well as expansion of new non-traditional mining operations.

He said there were positive developments in the energy minerals sub-sector, including issuance of a mining license to A-Cap Resources for uranium near Serule, while African Energy intended to mine coal and generate power at Sese.

He also said investor confidence had increased in the diamond industry after market demand for rough diamonds improved slightly this year.

 “Carat sales and revenue for this year are forecast to be 65 per cent and 27 per cent respectively above 2015 as a result of improved global demand,” President Khama said.

He explained that Lerala Mine started production in April and had already made two sales, while the Karowe mine continued to perform well after unearthing the second largest diamond in history; Lesedi la Rona.  

However, he said, the BK 11 mine had continued to operate under care and maintenance.

President Khama stated that copper and nickel prices had however remained depressed, put BCL and Tati Nickel mines under severe financial constraint, which resulted in a decision to place the BCL Group under provisional liquidation in October.

“In taking this difficult step, government was confronted by the fact that to stay afloat the BCL companies required an additional P2 billion over and above the P1 billion plus government had guaranteed for a bridging loan advanced by Barclay’s Bank in April 2016.

These additional funding requirements, on top of the Barclay’s loan that must be serviced by Government, had by any measure exceeded our financial capacity for further support; more so that based on medium term projections the mines would continue to incur losses,” he said

He pointed out that other copper mines in the country were also struggling and Boseto Mine, which was acquired by Khoemacau after undergoing liquidation in 2015, remained under care and maintenance. He however, expressed hope that the mine would re-open by end of next year.

He said Mowana Mine was also put under liquidation at the end of 2015 and was seeking new investors. ENDS