Gov�t unaccountable to Parley on BCL closure
Dithapelo Keorapetse | Friday November 25, 2016 17:36
There was a back-and-forth exchange between the opposition MPs and the minister with the former pressing for answers with probing questions and the latter being evasive and or euphemistic.
There are other ordinary questions being asked in this special NDP 11 session of Parliament on BCL, the idea is to get as much information as possible to get to the bottom of the issue. At the end of the mini-debate last week Friday, Parliament was left with more questions than answers on the whole BCL saga. The town of Selebi-Phikwe is becoming more and more desolate, there is despair, anguish and sorrow. The future for many is uncertain, for some there is no future at all.
The questions by MPs to the Minister Minerals, Green Technology and Energy Security were very simple. First it was a question on whether government was in a position to say it made a terrible mistake or alternatively that it was ill advised by especially the executives of Mineral Development Company Botswana (MDCB) to liquidate BCL.
This question was asked against the backdrop that MDCB was set up to acquire and manage government investments in the mining industry. The first to be acquired by the mining investment arm, it would appear, was BCL. When the Minister of Minerals in South Africa approved the sale of 50% stake of Nkomati by Norilsk, MDCB bosses sought to renegotiate the value of the assets to below P3 billion on account of low commodity prices. Norilsk wouldn’t agree and insisted on the P3 billion or so and MDCB, which held the power to negotiate on behalf of BCL insisted on a discount and lied that there was no business case for BCL.
The BCL business case could be found in their $4 per pound recovery plan and the smelting of Nkomati concentrates at the smelter plant in Selebi-Phikwe. In fact, before the MDCB screwed up, an easy and achievable payment plan was such that BCL would pay Norilsk over a period of time with proceeds from Nkomati concentrates. When they realised they messed up the deal previously negotiated by BCL, they ran to Cabinet to cause liquidation. The reasons for their behavior remains a mystery. MPs wondered why the company wasn’t placed under judicial management instead of liquidation.
Secondly, there was a question on why BCL was closed notwithstanding the $4 per pound recovery plan. The plan was clear and feasible, it had been verified by Mineral Corporation (MCC), a South African based company. According to the plan, BCL needed P2 billion recapitalisation, half of it in 2016 and the other half next year 2017.
The estimated figure was based on Nickle prices at $4 per pound, and at the time cabinet considered it, prices were at about $4, 6 per pound. The $4 was a very conservative figure, considering that prices are now recovering at over $5 per pound Nickle. In 2017 prices are predicted to be back and good.
This is probably why companies are said to be interested in buying BCL and resuming mining operations. Part of the recovery plan entailed restructuring which would result in retrenchments as a result of stoppage of non-core functions and or expensive or unprofitable operations-closing some shafts and mechanising some. BCL therefore needed money for packages of workers who would be retrenched.
Thirdly, the minister was asked about the BCL resources and clearly he had little or no idea about this. Other related questions were why government was consistently making reference to the depth of the mine and its low grade ore as reasons for closure and no business case argument.
According to BCL resource statement, the mine’s total resources stand at 25 million tones at grades of 0.66percent Ni and 0.77percent Cu, from this resource figures, around 2,7 million tonnes of measured resources at 0.86Ni and 0.98Cu have been declared. This is high grade ore which can be mined at a profit. The due diligence shows that there are ample reserves to run the mine up to 2022 and with more evaluation the life can be extended to 2034.
The deepest shaft at BCL is 1540 meter level whilst the shallowest production level is at 650 meter level with the potential to go up to 450 meter level. Depth is and has never been an issue for BCL. Other mines elsewhere mine in excess of three kilometers level.
Fourthly, BCL has about 10 exploration joint ventures, including the Maibjwe diamond project.
There are allegations about the diamond joint ventures being separated from BCL, effectively stolen and given to some well-placed people for free. The minister was asked to shed more light on these exploration ventures and the Maibjwe project but he had no information about the issue or he was just dishonest.
The unprecedented and dastardly decision to throw thousands of people into the streets by closing BCL is one of the greatest frauds in the 21st century Botswana. The decision was selfish, discourteous and devilish.
When the time comes, those responsible must be held accountable, be charged with treason for they have subversively sabotaged the economy of the town and in the process committing crimes against humanity-condemning people to death through poverty, stress, despair and even suicides.