Saturday, June 3, 2023

Botswana takes giant leap towards energy security

Hopes are high as the government establishes its national oil company (NOC) but there is one less than inspiring reality that cannot be ignored.

As a state-owned enterprise, the Botswana Oil Limited (BOL) natively has non-commercial objectives (like employment generation for locals, provision of social and other infrastructure and income redistribution through subsidised prices) which in some parts of the world have been known to affect the commercial performance and profitability of these entities. However, BOL’s Chief Executive Officer, Willie Mokgatlhe doesn’t expect such eventuality to befall his company.

“As a private company we are attentive to the fact that our company must be commercially viable. When conceptualising our project plans, we consider various factors, including the long-term sustainability of the company and therefore our commercial performance. The initiatives that you have cited would not hinder the company’s commercial viability,” he says.

The government privatisation plan is finally taking off, with the Botswana Telecommunications Corporation Limited launching its initial public offering (IPO) next month. In terms of the plan, state enterprises that undergo this process will hive off 49 percent of their shareholdings to members of the public. Mokgatlhe says that the listing of BOL on the Botswana Stock Exchange, is “expected after two years of solid performance.” He expects this listing to enhance its commercial performance as the company will become accountable to its many shareholders.

“As part of mandate, we are tasked with the responsibility of facilitating the participation of citizen emerging companies in the petroleum sector. In additional, our strategic road map is to embark on projects that would ensure self-sufficiency of fuel products. We see this role as cardinal to the government policy of economic diversification and job creation. Our view is that this can be achieved without interfering with the commercial viability of the company,” he says.

BOL joins a club of long-established national oil companies in the Southern African Development Community (SADC) and so it was natural for the government to benchmark against these and those far afield before it set up its own. Mokgatlhe says that the government constituted a consultancy that conducted benchmarking exercises with a selection of countries which have operational NOCs and assessed their strategic intents and business operating models. Case studies for companies such as Petroleos De Venezuela S.A. (PDVSA), which is the National Oil Company of Venezuela, were studied. Following the information gathering stage, focus turned to NOCs operating in the SADC region and benchmarking was conducted with PetroSA in South Africa, PetroMoc in Mozambique, NamCor in Namibia and NOCZim in Zimbabwe. The latter has since been split into two: Petro-Trade and National Oil Infrastructure Company of Zimbabwe.

“Other NOCs engaged include those of Kenya and Angola. We continue to engage other NOC’s in order to learn from their experiences,” Mokgatlhe says.

He adds that for BOL to fulfill its mandate of ensuring security, self-sufficiency and efficiency of supply of petroleum products to the country, it is important for it to form partnerships with local, regional and international partners. Some of these linkages have been formed with PetroSA, PetroMoc and NamCor, international oil companies, Transnet, Sasol, Botswana Railways and the Botswana Unified Revenue Service.

Mokgatlhe’s familiarity with major players in the international oil industry stands him in good stead to discharge his mandate.

“I believe that my work experience thus far, not only in the private sector but in all the organisations that I have served, has provided me with invaluable experience. I spent over 15 years in the petroleum sector and most of these years were spent with Shell. I joined Botswana Oil Limited from Vivo Energy (previously Shell in selected African countries) where I held the position of Managing Director of Vivo Energy Botswana and Vivo Energy Namibia where I was entrusted with the responsibility of formulating and implementing strategic goals and objectives of the two organisations. I have worked in international organisations with diverse cultures and in my view, excelled in such environments,” he says.

He carries the conviction that in order to achieve one’s dreams, hard work, dedication and commitment are key ingredients.

“The principle therefore is that, nothing is achieved without hard work. One should not be held back by cultural norms. Understanding and embracing what our country offers while adapting to strategies and solutions in the global village to suit our environment are key to success. I have successfully implemented change management during transformation,” Mokgatlhe asserts.

At Shell International, he held various senior positions including Strategic Issues Coordinator at Shell South Africa, Country Chairman at Shell Botswana and Shell Namibia, Government Relations Advisor at Shell International based at The Hague, Netherlands. In the latter position he was responsible for the African continent.

“I successfully led stakeholder engagements in all the countries during the Shell partial divestment as the company implemented the Shell downstream strategy for Africa. My guidance to these companies led to timely approval by regulatory authority/competition commission during the divestment. I chaired the Namibian Oil industry ensuring that the industry works closely with government to ensure the efficient delivery of products to the market, enabling the industry to win government trust as a development partner. I have previously worked for Air Botswana where I started as a trainee and ended up being the General Manager of the airline. It is this experience that I bring to Botswana Oil Limited,” Mokgatlhe says.

As Government Relations Advisor for Africa at the Shell headquarters in the Netherlands, he was required to functionally guide Government Relations professionals and the Country Chairman in Shell businesses in Africa in order to implement global, regional and the appropriate country-level government relations strategies.

“I was also responsible for evaluating Government Relations capacity in countries because of heavy investment profile or because of reputation exposure and recommend plans for risk mitigation. I worked to cultivate relationships with relevant external stakeholders especially with Senior Government officials, Ambassadors and business councils of the region and take prime responsibility for relationships with regional organisations, report on regional geopolitical initiatives and trends, and manage opportunities in consultation with the local Country Chairman. In addition, I leveraged external outlooks and formed country and regional strategic issues which impacted the Shell Group, either negatively or negatively,” he says.

The nerve centre of BOL’s operations will be a P750 million bulk petroleum strategic storage depot at Tshele Hills, about five kilometers west of Rasesa village off the Gaborone-Francistown (A1) highway. This facility will be used to store both strategic and commercial stocks as well as serve as a future cross-border fuel supply terminal. Construction has not yet started but according to BOL’s Marketing and Communications Manager, Ludo Mokotedi, the groundbreaking will take place soon.

With the Rasesa and another facility in Francistown, the government hopes to increase the national strategic reserve from the current 22 days to 60 days and the overall plan is to reach 90 days.


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