Thursday, July 18, 2024

It’s a whole “NEW BCL”

This past week, the current minister responsible for Minerals, Eric Molale told a group of journalists in the capital Gaborone that the government is looking at, “re-opening Phikwe” but has no intentions to hold a stake in the new operation.

This means that once a suitor is finally found, the government will be prepared to forgo its exclusive right established under the Mines and Minerals Act which allows her to acquire a minority stake (generally 15 percent) in mining projects as a partner. The Act also gives the government the right to seek participation in mining projects by having representation in the company’s board.

On Tuesday, Molale said under the new and imminent structure ÔÇô the mining operations at Selebi Phikwe will totally be private sector led.

‘Taking shareholding will not be of any help given the frequent fluctuations of copper nickel prices”, Molale admitted.

While he could not shed much light on prospective new owners of the mine, Molale said that already there are suitors that government has been in talks with.

“But of course they will have to go through the government procurement system”.

The BCL final liquidation in 2017 came after the closure of the mine is Selebi Phikwe in October 2016. The process follows a series of events that happened at the copper miner for close two decades as partially recorded below.

: As early as 2006, the BCL mine made headlines with all sorts of accusations being levelled against management by the workers, trade unions as well as political leaders. The former Member of Parliament for Selebi Phikwe West ÔÇô Kavis Kario was one of those who expressed his unhappiness with the way things are going at BCL copper/nickel Mine. On the other hand, Jack Tlhagale, the long serving Secretary General of the Botswana Mine Workers Union could not hide his contempt for the mine management who he accused of indiscretion. During the same year, another controversy started when the then Specially Elected Member of Parliament, Botsalo Ntuane, brought a question to parliament asking the then Minister of Labour Moeng Pheto to disclose the salary and perks of the mine General Manager, Montwedi Mphathi. Minister Pheto declined, saying Mphathi’s salary was a private matter that could not be discussed in a public forum such as parliament.

 CAS Consultants, an international consultancy company, blatantly warned the government that if it does not take any action aimed at diversifying the economy of Selebi-Phikwe it risks prospects of a revolution. In its bulky report delivered to the government, the consultants stated nine strategic points adding that “doing nothing is not an option”. The implication of the closure of the BCL Mine would, in the absence of diversification programme, be severe. The consultants warned that the loss of employment would directly affect thousands of Batswana. 


MARCH 2009: Three years down the line, the European Union (EU) provided an amount of P450, 000 for the preparation of a detailed socio economic ‘picture’ of Selebi Phikwe and its surrounding areas. The Socio-Economic Audit was part of EU’s comprehensive programme of P300 million to support BCL operations as well as economic diversification of Selibe Phikwe and surrounding areas
The Socio Economic Audit was commissioned to produce a basis of ‘hard information’, data and analysis which will help Selebi Phikwe Economic Diversification Unit (SPEDU) and other authorities to identify priority areas for utilisation of the available resources.

June 2014:
 In mid 2014, documents shown to the Sunday Standard, also presented to cabinet indicated that BCL Mine leadership proposed to government a new set of drastic steps to get away from the “sundown mentality that the curtain is about to close.”
The leaked documents indicated that the mine wanted to be allowed to become a “Base metals business of Southern Africa.”
The proposals came after internal discussions in Government established that SPEDU ( a parastatal established to save the town beyond BCL Mine) would not be able to move fast enough much less be capable of becoming a replacement of BCL in the town.
As part of the new plan, BCL was said to have started looking for mining deposits around the country that would replace the diminishing copper deposits that the company was mining.
The Mine was also to establish joint ventures which will fast-track the process of enlisting into its production pipeline a number of known deposits which had been left un-mined because at the time they were deemed not economic enough.

 Fast forward to the last quarter of the 2014, a general elections year in Botswana, BCL Limited and Norilsk Nickel announced that they have entered into definitive transaction agreements to sell Norilsk operations in Africa to BCL. 
This was to include a 50 percent participation interest in the Nkomati Nickel and Chrome Mine (‘Nkomati’), South Africa, and its 85 percent stake in Tati Nickel Mining Company located near Francistown. The total expected consideration for the Assets payable by BCL to Norilsk Nickel amounted to US$337 million payable in cash. In addition, BCL assumed all attributable outstanding debt and environmental and rehabilitation liabilities associated with each asset.

 By early 2016, signs were already showing that BCL’s top executives of the trouble ridden BCL mine might not have their 13th cheque during that December. 
Kitso Mokaila, who was at the time redeployed to the Ministry of Minerals, Energy and Water Resources, hinted in February 2016 to parliament that the future of the BCL executives hangs in the balance as he was considering showing them the exit door. When responding to a question from Selebi Phikwe West Member of Parliament (MP), Dithapelo Keorapetse during parliament question time, Mokaila described BCL management as “slow” and fell short of calling them useless.
“The management is not serious. They were too slow in doing certain things,” said Mokaila.

 On 7th October 2016, BCL miners clocked out of the final shift under the Mahupela management. Operations at the mine were stopped with immediate effect following the government’s decision to place the mine under the management of a provisional liquidator tomorrow. During the night of the same day, a delegation comprising the then newly appointed Mineral Resources, Green Technology and Energy Security Minister Sadique Kebonang, area MP and Minister of Infrastructure and Housing Development Nonofo Molefhi, Transport and Communications Minister Kitso Mokaila and Chairperson of Mineral Development Company Botswana Regina Sikalesele-Vaka addressed the BCL management and union leaders.


JUNE 2017: By mid last year, the High Court in the capital Gaborone granted an order placing BCL Mine in final liquidation, a development that was seen as the last kick on the teeth for former BCL employees and business associates. The move also triggered a series of events that legally end with a sale of assets and payment of creditors.


AUGUST 2018: Although the final liquidation process is still on, the Botswana government confirms that new suitors have shown interest in the mine. The liquidator Nigel Dixon-Warren had earlier during 2018 indicated that the process will take up to 7 years, but the government is opposed to such suggestion. This week, Molale made it clear that the government is not in agreement with suggestion made by the liquidator that the legal process could take up to seven years to end. “We do not agree with that”.

While it is not clear how the government will go about the legal processes relating to liquidation, one thing that is certain is that it has intentions to put up a “whole new BCL”.


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