Monday, October 26, 2020

The resurrection of Mowana copper mine

Following the suspension of its operations at Mowana Mine mid October 2015, the mining contractor, Diesel Power Limited then approached the High Court to have Messina Copper (Botswana), a subsidiary of African Copper liquidated. The previous owner, Messina Copper (Botswana) then suspended operations at the Mine, putting close to 400 workers on paid leave and ultimately axing them.

Fast forward to March 2017, new owners, Leboam Holdings resumed operations ramping up to an initial 12,000 tonnes a year of copper concentrate.

But now hardly two months before its first year anniversary of resuscitating operations, the company has embarked on a new London listing fund production.

By close of business this week, the company raised 5.65 million pounds as part of the listing to support the Mowana Copper Mine.

Production was halted at the mine in 2015, when copper prices fell in line with a wider commodity crash. However, fresh market data shows that copper has risen by more than 50 percent from the lows of late 2015 to early 2016.

In August 2017, the Managing Director of Leboam Holdings, Kevin van Wouw, made the announcement that his company achieved a breakeven for the first time as its income equalled to total costs.

Following a successful bid to Messina Mine Leboam Holdings has been under pressure to prove it’s worthy to operate the copper mine that has been closed more than two times. Leboam Holdings acquired Messina Copper assets late last year at P89.7 million.

Amongst other things, Leboam Holdings bought the mine on the terms that its funders show commitment to liquidator payment.

Von Wouw is said to have told Mowana mine workers in 2017 that, “while the funding has been slow to flow, things should start getting better from now forth”.

Sunday Standard has been informed that it is at the same meeting where Von Wouw told the miners that the US$15m is in addition to the US$23m funding the company has for the underlying transaction with Messina Copper.

The company is also said to be contemplating opening up an underground mine at Makala which is in Mosetsi village.

Von Wouw is also said to have told the miners that they are fully aware of the disbelief that still exists about the earnestness of the mine.

He said the huge negativity from the previous employees, creditors, funders and stakeholders still clouds their working environment. “We have been able to overcome this negative sentiment and get the support of the supplier base in Botswana for our project. I am sure that this disbelief will start turning into understanding and I expect more support as we go forward,” he said.

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