Friday, October 30, 2020

BCL liquidator faces Molale’s Axe

BY BONNIE MODIAKGOTLA

The strained relationship between the ministry of Mineral Resources, Green Technology and Energy Security and the BCL mines liquidator has reached a new crescendo, with the minister initiating a process to have the liquidator replaced. 

Eric Molale told parliament on Friday that the relationship between him and the liquidator has broken down irretrievably, and as a representative of the Botswana government which is the main creditor, he has “initiated a process to have the liquidator removed.”

“As it is now, I’m faced with a precarious situation at the mines. The shafts have been flooded, people are exposed to danger of working under unsafe conditions,” the minister said. 

The fallout between Molale and Nigel Dixon-Warren was expected following two contradictory statements they both made last week. On November 22, Molale told parliament that the government has no intention of reducing the 546 workers engaged at BCL and Tati mines tasked with the care and maintenance of the mine. He said not only did he stop Dixon-Warren from halving the staff, he pressed upon him to ensure that the employment level is optimized to ensure that they do not expose people to risks, and the liquidator agreed with him on that. 

However, three days later after Molale’s update in parliament, Dixon-Warren struck a different chord ÔÇô he told Businessday, a South African newspaper, that due to cash shortages, and the refusal of government to inject more money in the liquidation process, he was forced to take tough decisions. 

“The consequence of this is that the liquidator has been forced, with effect from 1st December 2018, to severely curtail the care and maintenance operations at both BCL and Tati,” he said, adding the workforce would consequently be reduced by some 220 people to 320. 

The contradictory statements came few days before the scheduled meeting between Molale, Dixon-Warren, and the Registrar and Master of the High Court of Botswana ÔÇô who had appointed the liquidator in 2016 following BCL mines sudden closure. The meeting took place this past Wednesday in which Molale says together with the Registrar, they were successful in making Dixon-Warren see reason why he should reinstate those people to continue with the care and maintenance of the mines. But this too was short lived. 

“He now defies his employer the Registrar. He has not reinstated them, and therefore I become somebody who is untruthful to this house because of a truant liquidator,” the visible irate Molale said. 

He says he has already started to consult lawyers so that whatever they are going to do from now on, it will be within the ambit of the law, and they will leave no stone unturned. “When I leave here, I’m going to pursue the matter further.” 

Molale also poured scorn on Dixon-Warren’s assertions that the liquidation process is cash strapped as government balks at releasing more money towards the exercise. The minister reiterated his earlier position of defending the government’s decision to fund the liquidation process when other creditors are not chipping in: In the past he had explained that the payments are in the form of advances, of which the government will be paid back after the liquidation process wounds up. 

Molale said the government as the main shareholder of BCL mines had to step up to protect its interests by paying for the care and maintenance so than when assets are finally sold, they will be in good condition. 

“So it is for this reasons that we still continue to fund this process of liquidation. As of Wednesday at our meeting it was disclosed that there is P250 million available for this process. So we are mindful of the expenses of funding this liquidation,” he said. 

Molale said even if they ran out of cash, he will go the ministry of Finance and Economic Development to ask for more funds. “At this juncture, there could not be any excuse that that there is no money. I’m stating it here categorically that we have the funds.” 

The government has already spent over P1.1 billion towards BCL since its closure, with a larger proportion of the funds paying former employees’ benefits, and the rest towards the care and maintenance of the mines. The liquidator has so far pocketed over P42.3 million in over twenty months, averaging P2.2 million monthly in fees.

RELATED STORIES

Read this week's paper

International artists enjoy bulk of royalties paid by Botswana

International artists continue to enjoy a lion’s share in royalty payments from Botswana. Copyright Society of Botswana chief executive...