Gov�t can�t save BCL � Guma

Onalenna Kelebeile | Tuesday October 11, 2016 18:00

The MP, who is also the chairperson of the parliamentary Public Accounts Committee said it was not necessary to romanticise or compromise, but for the government to tell people the truth that nothing else can be done to save the BCL Mine.

Speaking during employees’ address by a delegation led by Minister Sadique Kebonang, Guma said all that could be done to save the mine has been done.

“You should know as employees at some point the mine has to reach a dead end and it has. Government is already faced with a huge deficit ahead of the coming NDP 11. If somebody can come and scale down BCL Mine that can be allowed, but government should be recused,” he said.

The MP said it is the duty of government to distribute resources equitably across the whole country not in the mine alone.

“As a government I have to protect the assets of the country and there is no money that Parliament can approve to save the situation and I am going to tell Tati Nickel Mine Company employees the same thing,” he said.

Meanwhile, High Court on Sunday afternoon appointed Nijel Dickson from KPMG as the liquidator and he assumed powers of the BCL management and that of the board of directors as of yesterday.

When addressing Selebi-Phikwe Town Council on Monday morning minister Kebonang explained that from 2007 government spend P10 billion on BCL alone and said that the mine’s commodity prices are no longer profitable. He stated that with the health and safety aspect of the mine also taken into consideration, an additional P7 billion would be needed to replace the old mine machinery.

He added that it was a wise decision for government to apply for a provisional order of liquidation ahead of BCL’s creditors.

Kebonang noted that there had been imminent threats by creditors to compulsorily wind up BCL Mine and that would mean closing down Selebi-Phikwe.

He said the liquidator will assess to see what can be salvaged from the mine and whether it is economically viable to keep BCL as a business or otherwise.

He explained that consent from South African cabinet was needed for BCL to acquire the 50 percent Nkomati shareholding, but it took long until only a few weeks ago when commodity prices had plunged. “Nkomati had threatened to sue BCL to pursue it to go ahead with the deal and this would mean paying P3 billion for a mine that is currently a fraction of its initial value,” he added.

He explained to councillors that the cost of production at BCL exceeds that of its sales and that not all of its shafts are profitable. Its ore, just like that of TNMC, is no longer profitable. He said that currently the mine needs P4.6 billion to keep operating while it’s 98 percent unproductive.

Kebonang said the process by the liquidator may take 12 to 18 months or less and said employees remain entitled to their benefits.

“I cannot ascertain if the mine will continue existing, the length of the exercise or whether all employees will be retained, but that will depend on the liquidator’s recommendations,” he said.

He however, noted that government is working tirelessly around the clock to find alternative measures to mitigate job losses.

“The decision on the provisional liquidation was not an easy decision to make, but it was a question of saving one entity to the detriment of the whole country’s economy. It is a fact that at some point BCL was going to close down as a result of mineral depletion. The mine was currently mining two kilometres deep and its production levels had reached its lifespan,” he noted.

He said since April last year there had been no production that could even sustain employees salaries.

The chairperson of the Mineral Development Company Regina Vaka-Sikalesele told the workers that her operation officially took over BCL mine last Friday and is the first company they took over. She said the decision to appoint a liquidator was urgently taken on Sunday because BCL is a big company that supports the whole region. She said the liquidator would evaluate and make recommendations that will inform a final decision on BCL.

MP for Selebi-Phikwe West Dithapelo Keorapetse had earlier on appealed to relevant authorities to do their best to save the mine and the town. He said the closure would have far reaching implications even on all entities whose major consumer is BCL.

“Let all the promises you make to employees stand. If there is no hope let them know so that they also can also make their own plans. I am currently sourcing information on what provisional liquidation really means to employees because I want to know how long their salaries can be sustained while they are not working,” he said.

Councillors on the other hand expressed concern that they have long asked government to intervene on BCL and wanted to know the fate of business partners who BCL is obliged by contractual agreements with.