Thursday, October 22, 2020

BCL has sufficient mineral reserves to mine beyond 2022ÔÇô leaked documents

Despite the decision by the government to force BCL into voluntary liquidation, fresh information has come out suggesting that the copper nickel mining and smelting company is anticipating to return to positive bottom line within the next two years. 

The Telegraph has turned out information that indicate that as part of its briefing to the cabinet subcommittee, BCL had indicated that its forecast shows that by 2018 its Selkirk project will be fully implemented while metal prices will also go up ÔÇô developments that BCL believes would return it to profitability by the same year. 

The BCL projection, which is based on pricing guide supplied by Consensus Economic ÔÇô an industry accepted forecasting house that is used by various conglomerate across the global markets pegs metal prices above US$5.50/lb. 

It has further emerged that a few days before the announcement of the voluntary liquidation, the cabinet subcommittee was furnished with information that showed BCL has sufficient mineral reserves to last well in the future, “and these reserves can be mined commercially to end of mine life”. 

The current depressed commodity prices is expected to last into 2017 and it is the two years that BCL is said to be in need of government support. 

“The current situation is no different to previous periods, the only difference is part of the requested funding entails reconfiguring the business to be better prepared to weather such eventualities in the future and to provide the government of Botswana with softer landing when there will no longer be sufficient reserves to mine commercially,” reads part of the talking notes that were submitted at the cabinet subcommittee on 1 October 2016 ÔÇô a few days before government went on to shut the BCL mine down. 

Commodity and metal prices have been on a freefall over the past two years as the global economy continues to experience challenges. The drop in prices particularly for metals is attributed to scale down of mineral purchases by China owing to poor performance of its industrial and manufacturing sectors.

China has been a top metal buyer before challenges hit its manufacturing sector about two years ago. 

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