Monday, June 24, 2024

Boseto mine closure drags down mining contribution to GDP

The recent closure of Boseto Copper Mine, located in the Ngamiland District has resulted in a decline in copper production during the first quarter of 2015; latest Gross Domestic Products (GDP) data released by Statistics Botswana (SB) has shown.

Pursuant to an application made by one of the local banks, Standard Chartered Bank, Discovery Metals which owns the Boseto copper mine was early this year placed under provisional liquidation after failing to meet its financial obligations amounting to overP1.3 billion to various creditors. The troubled Australian company had been a having tough time with lenders and later acquired a US$5 million short term working capital facility that was to be paid in full before 31 March 2015, as part of its talks with Cupric. The Boseto Copper Project which was officially opened by President Ian Khama in 2012 was DML’s first producing copper mine and is believed to have been brought on stream on time and within budget.

The Project is designed to produce an average of approximately 36,000 tonnes copper and 1.1 million ounces silver per annum in concentrate from 3 million tonnes per year (3Mtpa) of ore feed to the concentrator.

Researchers at the government statistics agencies said this week that although on annual basis, the production of Copper/Nickel increased by 14.9 percent, it however decreased by 15.3 percent on quarter-on-quarter comparison.

“The decline has been mainly attributed to the closure of Discovery Metals Limited (Boseto) copper mine in March 2015,” Statistics Botswana stated in the 2015 first quarter GDP report (GDP: Q1).

Meanwhile Statistics Botswana said estimated GDP at current prices for the first quarter of 2015 was P35 855.6 million compared to P36 892.1 million registered in the fourth quarter of 2014 (2014:Q4). At the same time, estimated GDP at constant 2006 prices for the first quarter of 2015 was P22 068.2 million compared to P22 364.5 million registered in the fourth quarter of 2014, amounting to a decrease of 1.3 percent (see table 3). Real Gross Domestic Product (GDP) increased by 4.3 percent in the first quarter of 2015 compared to 3.6 percent accrued in the same quarter in 2014.


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