Wednesday, July 17, 2024

The Mining sector’s path to recovery

Parliament has been told that in the shadow of a COVID 19 sponsored global pandemic and a tumultuous economy, there are clear signs pointing towards a healthy recovery for the country’s mining sector during 2021.

Minerals Minister Lefoko Moagi said this past week that while the COVID 19 pandemic took a toll on the country’s mining sector, particularly diamonds in 2020, the industry is now gaining momentum to recover.

Apart from reduced sales, available mining figures shows that during 2020 Botswana saw an unexpected and unprecedented downturn in the production of its key minerals such as diamonds and copper.

Moagi has however assured the nation that the signs are pointing towards a bounce-back with stronger growth through 2021.

“The signs of recovery are mainly due to companies re-arranging their operations and recovering from the Covid-19 impact which had earlier led to restrictive containment measures, including social distancing, remote working and the closure of commercial activities that resulted in operational challenges”, Moagi said.

Figures shared in Parliament this week records signs of recovery in copper prices which increased from US$2.57/lb end of 2019 to US$3.52 (37%) by the end of 2020 while gold prices have shown an increase from US$1270/oz end of 2019 to US$1524 (20%) by end of 2020.

Moagi told Parliament that investors have started showing optimism for the development of minerals in Botswana and that, “This has led to Maatla Energy Resources being granted a mining licence for the development of a coal mine in Mmamabula coalfields”.

Moagi also said that some other existing companies are also investing money to increase the life of Mine and production.  Karowe diamond has since announced its underground Mine expansion project while Morupule coal open cast extension and Jwaneng Mine post cut 9 studies which are focused on an underground mine also continues.

Moagi also told Parliament that as part of interventions to mitigate against the travel restrictions globally, the government authorised diamond producers to take diamonds directly to the markets in Europe and Asia to sell, after valuation by Government Diamond Valuers.

“While the sales have resumed, the market remains fragile”, Moagi said.

Diamond mining in Botswana accounts for nearly 20 percent of the GDP.  


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