Cradle Arc Plc, the parent company to Leboam Holdings, the new owners of Mowana Mine has said that it is still raising capital to finalise the liquidation process in settling its creditors.
Messina Copper Botswana (Pty) Ltd the previous holder of the mining license for Mowana Mine was placed under provisional liquidation in November 2015, with the final liquidation order granted on 15 December 2015.
On 16 January 2017, the High Court ordered that the mining license for Mowana Mine as well other mineral concessions held by ‘Messina Copper Botswana (Pty) Ltd in Liquidation’ be transferred to Leboam Holdings (Pty) Ltd. The licences were transferred.
Parliament last week heard that, Leboam Holdings is currently working on a new life of mine plan for Mowana Mine, and this plan will inform how long the mine can continue producing.
Former Minister of Mineral Resources, Green Technology and Energy, Sadique Kebonang told Parliament that, “the Liquidator has entered a Liquidator Term Loan Agreement the terms of which, the liquidation sale proceeds will be paid by the purchaser over a period of 24 months from January, 2018. In this connection, full repayment of this loan is expected to be complete in January, 2020 unless early settlement is effected.”
In the interim, the parent company, Cradle Arc Plc has commissioned Tamesis Partners in London to initiate a refinance enquiry whereby the full liquidation and development capital is being raised on a best effort basis. The total quantum of this raising is USD50million (P480.6m, the exchange rate by Friday 6th ). The first USD10million (P96.1m) for the commencement of the new life of mine plan is closing by the end of March, 2018. It is expected that the balance of USD40million (P384.4m) will be closed by the end of June, 2018.
Kebonang further revealed that, “there are six major funds and other capital providers are currently performing their due diligence processes. If successfully refinanced, this will settle the liquidation balances, and we could expect finalisation of all outstanding balances by the end of July, 2018.”
Leboam Holdings has since appointed a Manager for mine and his qualifications and experience have been approved by the Department of Mines. The Manager’s duty is to ensure that provisions of the law are observed and enforced in Mowana Mine. Furthermore, mine inspectors visit the mine to ensure the provisions of the law are complied with. From inspections by the Department of Mines since recommence of work at the mine in April 2017, it has been observed that the mine is generally complying with the requirements of the law, although at times some deviations have been observed. Whenever deviations are observed by the inspectors, the inspectors direct that the deviations be corrected, and the Manager takes the necessary action to remedy these.
Re-commissioning of Mowana Mine was in April 2017 and the mine has been producing since then, even though it experiences some production challenges.