23 Feb 2023

Government’s decision to invest is guided by the viability of a proposed mining project taking into account the size of the project.

“Government only takes a participatory stake provided the project is viable and is of economic or strategic benefit, hence cannot invest in every mining venture,” explained Minister of Minerals and Energy, Mr Lefoko Moagi when he was responding to a question in Parliament on Tuesday.

He added that factors to consider when assessing the option for government to participate in a mining project included feasibility of the project, return on investment, size and strategic nature of the project as well as risks to the project.

Mr Moagi said Botswana had built a massive reputation as mineral investment jurisdiction because of the political stability and liberal mineral legislation.

He indicated that at the time of application for a mining license, the ministry and the Minerals Development Company Botswana (MDCB) thoroughly assessed the proposed mining projects for possible investment by government as required by section 40 of the Mines and Minerals Act.

“As for the diamond mining projects, section 51 provides that at the time of application for a mining license or its renewal or transfer, if the government is interested in taking up a stake, there ought to be negotiations between the government and the applicant,” said Minister Moagi.

He further told MPs that government had established the MDCB, a state owned mineral and mining investment holding company to grow, optimise and diversify mining and minerals investment portfolio on its behalf.

“This mandate also includes providing government pristine advisory services in mining, both commercial and technical, as well as facilitate development of the local mining and minerals sector. 

MDCB has commenced market intelligence activities in order to build knowledge and an investment pipeline.

However, where undisputed compelling mining investment opportunities become available, it should be possible for MDCB to partake in these governance processes that have been established by the company,” he added.

He indicated that government would continue to support implementation of the MDCB mandate and strategy through provision of support, including funding for implementing its strategic ambitions. 

Parliament also heard that Botswana had recently launched digital technology of the online Mining Cadastral System, where the Department of Mines and BGI jointly undertook key projects to avail information and services globally through interactive online channels where investors can make enquiries and formal applications for prospecting licenses from anywhere in the world.

“This is one of the success stories of Botswana as it makes the country more accessible to investors globally and it is a milestone that puts Botswana well on the way of improving the mineral prospectively indices and transparency of the licensing process to the world class status,” he said.

Again, he said government was amenable to undertaking and developing processes that would assist growth of the mining industry and the ministry was researching more strategic funding approaches as well as reviewing the establishment of an exploration fund.

Kanye North MP, Mr Thapelo Letsholo had asked the minister to give an update on Botswana’s investment strategy, associated beneficiation as well as value chains development in the mining and minerals sector in the country.

Mr Letsholo also wanted to know if government was amenable to the proposal to develop a fund or capital markets infrastructure for mining start-ups that would allowed skilled citizens to be able to explore and get a start in mining. Ends