November 17, 2017

Botswana government vows to continue funding underperforming miner, BCL

Faced with the options of shelving operations of the loss-making BCL, Botswana’s biggest copper and nickel miner, or keeping it operational, the government of Botswana prefers the latter.

Mindful of the loss of 5,000 jobs that might result from closure, the government says it will continue to inject $130 million (1.4 billion pula in the local currency) into BCL, of which is its asset.

On BCL’s future, Mokgwetsi Masisi, Botswana’s Vice President, says the country will sell its share as soon as the company returns to profitability.

Acknowledging that at some point the bail outs of BCL, which he describes as “unprofitable, unsustainable and expensive” will have to stop, Masisi says: “[While] we have got about 15 more years to go, [the company’s output is] deep, poor-quality ore — it’s like flagging an old woman and asking her to run in the Olympics,” Masisi said. “It’s unprofitable, unsustainable and expensive.”

Minerals export are the Botswana’s main source of revenue. Efforts to diversify the economy of the sparsely populated country have not borne substantial dividends.

This year the country is celebrating 50 years of independence.

(information sourced from a report filed by Bloomberg and adapted for African Mining Brief Online)

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