Maibwe venture remains stuck in BOD pipeline
Business
The abrupt and controversial liquidation of BCL two years ago has not only affected those who benefited directly from it—a lot who did dealings with the moribund copper-nickel ore smelter like Botswana Diamonds (BOD) which got in an indirect partnership with the mine are apparently frustrated by an unfinished business of an exploration venture.
The BCL liquidation remains a stumbling block on Botswana Stock Exchange and London Stock Exchange listed BOD because it stands on the company’s exploration prospects on lucrative Maibwe Joint Venture which comes with ten licenses.
Maibwe is situated in the Gope area in the central region of Botswana.
The Maibwe Joint Venture is currently owned by BCL or BCL Investments which holds a lion’s share of 51 percent, Future Minerals holds 20 percent and BOD subsidiary Siseko has a stake of 29 percent. Siseko is 51 percent owned by BOD.
BOD is worried that it cannot get hold of its exploration project sooner that it promised its investors because the company that owns a major stake at Maibwe, BCL Limited or BCL Investments has been liquidated subsequently putting any business that could be done by Maibwe on a freezer.
Initially BCL had wanted to sell its 51 stake in Maibwe Joint Venture following its liquidation in 2016. BOD shown huge interest to buy the shares and team up with its subsidiary Siseko to get a huge chunk from Maibwe but the talks were halted as the BCL liquidator Nigel Dixon-Warren decided to play hard ball in order to get a better deal according to him.
In an interview with BusinessPost, Dixon-Warren also put clarity on the misconception that BOD has direct shares on Maibwe saying, “I do not know of any agreement between BOD and BCL on Maibwe.” The international media and other news websites had suggested in their reports that BOD directly owns Maibwe and has prospects to drill it as its own venture, but Dixon-Warren has not seen a legal bond between Maibwe and BOD. He told this publication that he is going to start by dealing with other shareholders first like Siseko, the BOD subsidiary.
“I am very careful about our Maibwe shares. I am still assessing the value of the shares and I have engaged experts to help me review our Maibwe shares, then I can take a consideration and see when it is fit to sell the shares,” said Dixon-Warren.
BOD is still adamant in getting BCL shares because it cannot do any drilling Maibwe according to BOD managing director John Campbell.
The BOD managing director told Mining Weekly last year that they are planning on buying out BCL because the project is currently in “suspended animation” due to high interest results recorded previously on Maibwe at the time the liquidated BCL was drilling the project. This year during a mining conference held in Botswana Campbell also concluded that, “we have put in an offer to the liquidator of BCL and we hope to get a response in the next few months.”
In a recent interview with BusinessPost Campbell also confirmed that BOD has no relationship with BCL or is a shareholder in the Maibwe Joint Venture. “BOD is a shareholder in Siseko, which is a shareholder in the Maibwe Joint Venture. I have been proposed as an alternative director to the Maibwe Jenture Venture by Siseko and a member of the technical committee. In my latter role, I have assisted the liquidator in drafting a prospectus on the Joint Venture which the liquidator is currently finalizing. BOD has no direct relationship with BCL or the liquidator aside from the roles I have already outlined,” said Campbell.
BOD DISCOVERS DIAMONDS ON THE RUINS OF ANGLO BOER WAR
BOD’s latest exploration update released this week says the company has recently found the potential of the Free State to host further commercial kimberlites. It further states that the discovery comes after extensive research which was done in various archives into the history of diamond mining in South Africa.
“This research found that in addition to the well documented iconic operations at Jagersfontein, Koffiefontein and Kimberley, a number of smaller diamond mines existed both to the east of Bloemfontein and extending west to Kimberley,” said the BOD website. What was more interesting about this latest discovery is that it was found around Frees State after a century old of lack of record keeping and documentation on diamonds following the Anglo Boer war of 1899-1902.
According to BOD, there was once a law that barred an exploration intention or information and documentation regarding any diamond discovery in the aftermath of the Anglo Boer war. BOD said this month their team of researchers took a field trip to the Free State and perused into the area which was affected by extensive document loss and destruction consequent to the Anglo Boer war of 1899-1902.
“In spite of this much is still available and there remains considerable anecdotal evidence from the time. It was clearly noted that the industry as a whole was active up until the early 1880's, but that "a wave of financial collapse and depression swept over South Africa…." such that …"even old established diggings like Jagersfontein, Dutoitspan and Bultfontein were partially abandoned and younger [smaller] mines were totally deserted",” said BOD when quoting the researcher’s report on the Free State project.
The BOD exploring specialist also found evidence that there were previous attempts to re-open these “smaller” mines in the early 1900's, but these were frustrated by bureaucratic intervention due to conflicting laws in the lead up to the accession by the Free State Colony into the Union of South Africa. According to BOD, the result was that permission to restart the mines was not granted, these mines have never been reopened, and their history lost with land ownership changes over time.
BOD accounts their latest exploration to their hi-tech ability of using aerial imagery and ground trothing to complete “the jigsaw” which has enabled the company to focus its attention on areas within its Koppiesfontein, Poortjie, Swartrandsdam and Tafelbergsdam properties where historic workings and abandoned equipment are clearly evident.
“Available archived diamond certificates in respect of limited exploration activities around Tafelsbergsdam issued in 1898 disclosed recovery of 111 carats of diamonds valued at approximate £93 each which is estimated by the Company to be in excess of US$300/ct in today’s money,” said BOD. The BOD believes it has done its homework on the research and exploration, with the help of high technology, it is ready for exploration.
BOD Chairman John Teeling, said: “The Free State story is a fascinating one. Starting from document archives from well over a hundred years ago where some of these kimberlites were diamond producers to modern exploration using whole rock geochemistry, kimberlite mineral chemistry through to detailed ground geophysics. The next step is clearly drilling to determine the kimberlites current commerciality. I look forward to providing further updates regarding the drilling programme in due course.”
Business
New Khoemacau owners commit to mine’s multibillion Pula expansion
The future of Botswana’s largest copper and silver operation, Khoemacau Copper Mining, looks promising as the new owners, MMG Group, commit to the mine’s expansion plans. MMG, an Australian headquartered company owned by China, has expressed its dedication to doubling Khoemacau’s production and transforming it into one of the most significant high-grade copper operations in Africa.
Nan Wang, the Executive General Manager for Australia and Africa at MMG, stated that while the immediate focus is on maintaining a consistent production level of 60ktpa, there are solid plans to increase Khoemacau’s production capacity. The company aims to double its production from 3.65Mtpa to 8.15Mtpa, resulting in an increase in payable copper from approximately 60ktpa to around 130ktpa.
To achieve this expansion, Khoemacau has completed a pre-feasibility study on the project and a solar power initiative. The next step is to conduct a feasibility study, which will pave the way for increased production capacity. Additionally, Khoemacau has identified extensive exploration opportunities across its license area, positioning the company for an exciting new phase of development.
The current Khoemacau operation reached full production and nameplate capacity in December 2022, following over a decade of investment totaling over P10 billion. This significant investment allowed for an intense exploration program, resulting in the development of the most automated underground mining operation in Botswana. The first concentrate was produced in June 2021, and the product entered the export market in July of the same year. Throughout 2022, the company has been working on the pre-feasibility study for the expansion project, with the feasibility study scheduled for the following year.
The expansion plans will involve the construction of a new world-class process plant in Zone 5, where the current mining of ore takes place. This new plant will be larger than the existing one in Boseto, which currently receives ore from Zone 5. The expansion will also involve the development of new underground mines, including Mango, Zone 5 North, and Zeta North East. These additional mines will bring the total number of underground shafts at Khoemacau to six. The ramp-up of production from the expansion is expected to occur in 2026.
Khoemacau, which acquired assets in the Kalahari Copper Belt after the liquidation of Discovery Metals in 2015, currently employs over 1500 people, with the majority being Batswana. The Khoemacau Mine is located in north-west Botswana, in the emerging Kalahari Copperbelt. It boasts the 10th largest African Copper Mineral Resource by total contained copper metal and is one of the largest copper sedimentary systems in the world outside of the Central African Copperbelt.
The mine utilizes underground long hole stoping as its mining method and conventional sulphide flotation for processing. Resource drilling results have shown the existing resources to have continuity at depth, and there are several exploration targets within the tenement package that have the potential to extend the mine’s life or increase productivity.
The Zone 5 mine has already ramped up production, and further expansion in the next five years will be supported by the deposits in the Zone 5 Group. The estimated mine life is a minimum of 20 years, with the potential to extend beyond 30 years by tapping into other deposits within the tenement package.
In conclusion, the commitment of MMG Group to Khoemacau’s expansion plans signifies a bright future for Botswana’s largest copper and silver operation. With the completion of pre-feasibility and feasibility studies, as well as significant investments, Khoemacau is poised to become one of Africa’s most important high-grade copper operations. The expansion project will not only increase production capacity but also create new job opportunities and contribute to the economic growth of Botswana.
Business
Khoemacau Copper Mining to be acquired by MMG Limited
Khoemacau Copper Mining, a leading copper mining company, has recently announced its acquisition by MMG Limited, a global resources company based in Australia. This acquisition marks a significant milestone for both companies and demonstrates their commitment to continued investment, growth, and sustainability in the mining industry.
MMG Limited is a renowned mining company that operates copper and other base metals projects across four continents. With its headquarters in Melbourne, Australia, MMG has a strong track record in mining and exploration. The company currently operates several successful mines, including the Dugald River zinc mine and the Rosebery polymetallic mine in Australia, the Kinsevere copper mine in the Democratic Republic of Congo, and the Las Bambas Mine in Peru. MMG’s extensive experience and expertise in mining operations make it an ideal partner for Khoemacau.
MMG’s commitment to sustainability aligns perfectly with Khoemacau’s values and priorities. Khoemacau has always placed a strong emphasis on safety, health, community, and the environment. MMG shares this commitment and applies the principles of good corporate governance as set out in the Corporate Governance Code of the Hong Kong Listing Rules. As a member of the International Council on Mining and Metals (ICMM), MMG adheres to sustainable mining principles, ensuring responsible and ethical practices in all its operations.
Over the past 12 years, Khoemacau’s current shareholders have made significant investments in the development of the company. With approximately US$1 billion deployed in the project, Khoemacau has successfully transformed from an exploration and discovery phase to a fully-fledged operating copper mine. The completion of the ramp-up of the Zone 5/Boseto operations has set the stage for the next phase of expansion.
With the acquisition by MMG, Khoemacau is poised for an exciting new chapter in its development. The completion of a pre-feasibility study on the Khoemacau expansion and a solar power project has paved the way for increased production capacity. The feasibility study will be the next step in doubling the production capacity from 3.65 million tonnes per annum (Mtpa) to 8.15 Mtpa, resulting in a significant increase in payable copper from approximately 60,000 tonnes per annum (ktpa) to 130,000 ktpa. Additionally, Khoemacau has extensive exploration opportunities across its license area, further enhancing its growth potential.
The CEO of Khoemacau, Johan Ferreira, expressed his gratitude to the current owners for their stewardship of the company and their successful transformation of Khoemacau into a fully operational copper mine. He also highlighted the company’s focus on the expansion study and its vision for the future with MMG. Ferreira emphasized that the partnership with MMG will ensure Khoemacau’s long-term success, delivering employment, community benefits, and economic development in Botswana.
MMG Chairman, Jiqing Xu, echoed Ferreira’s sentiments, stating that the acquisition of Khoemacau aligns with MMG’s growth strategy and vision. Xu emphasized MMG’s commitment to creating opportunities for all stakeholders, including shareholders, employees, and communities. He expressed confidence in Khoemacau’s expansion potential and the company’s ability to realize its full potential with the support of MMG.
The sale of Khoemacau to MMG is subject to certain conditions precedent and approvals, with the expected closing date in the first half of 2024. This acquisition represents a significant step forward for both companies and reinforces their commitment to sustainable mining practices, responsible resource development, and long-term growth in the mining industry.
In conclusion, the acquisition of Khoemacau Copper Mining by MMG Limited signifies a new era of investment, growth, and sustainability in the mining industry. With MMG’s extensive experience and commitment to responsible mining practices, Khoemacau is well-positioned for future success. The partnership between the two companies will not only drive economic development but also ensure the safety and well-being of employees, benefit local communities, and contribute to the overall growth of Botswana’s mining sector.
Business
BPC Signs PPA with Sekaname Energy
The Botswana Power Corporation (BPC) has taken a significant step towards diversifying its energy mix by signing a power purchase agreement with Sekaname Energy for the production of power from coal bed methane in Mmashoro village. This agreement marks a major milestone for the energy sector in Botswana as the country transitions from a coal-fired power generation system to a new energy mix comprising coal, gas, solar, and wind.
The CEO of BPC, David Kgoboko, explained that the Power Purchase Agreement is for a 6MW coal bed methane proof of concept project to be developed around Mmashoro village. This project aligns with BPC’s strategic initiatives to increase the proportion of low-carbon power generation sources and renewable energy in the energy mix. The use of coal bed methane for power generation is an exciting development as it provides a hybrid solution with non-dispatchable sources of generation like solar PV. Without flexible base-load generation, the deployment of non-dispatchable solar PV generation would be limited.
Kgoboko emphasized that BPC is committed to enabling the development of a gas supply industry in Botswana. Sekaname Energy, along with other players in the coal bed methane exploration business, is a key and strategic partner for BPC. The successful development of a gas supply industry will enable the realization of a secure and sustainable energy mix for the country.
The Minister of Minerals & Energy, Lefoko Moagi, expressed his support for the initiative by the private sector to develop a gas industry in Botswana. The country has abundant coal reserves, and the government fully supports the commercial extraction of coal bed methane gas for power generation. The government guarantees that BPC will purchase the generated electricity at reasonable tariffs, providing cash flow to the developers and enabling them to raise equity and debt funding for gas extraction development.
Moagi highlighted the benefits of developing a gas supply industry, including diversified primary energy sources, economic diversification, import substitution, and employment creation. He commended Sekaname Energy for undertaking a pilot project to prove the commercial viability of extracting coal bed methane for power generation. If successful, this initiative would unlock the potential of a gas production industry in Botswana.
Sekaname Energy CEO, Peter Mmusi, emphasized the multiple uses of natural gas and its potential to uplift Botswana’s economy. In addition to power generation, natural gas can be used for gas-to-liquids, compressed natural gas, and fertilizer production. Mmusi revealed that Sekaname has already invested $57 million in exploration and infrastructure throughout its resource area. The company plans to spend another $10-15 million for the initial 6MW project and aims to invest over $500 million in the future for a 90MW power plant. Sekaname’s goal is to assist BPC in becoming a net exporter of power within the region and to contribute to Botswana’s transition to cleaner energy production.
In conclusion, the power purchase agreement between BPC and Sekaname Energy for the production of power from coal bed methane in Mmashoro village is a significant step towards diversifying Botswana’s energy mix. This project aligns with BPC’s strategic initiatives to increase the proportion of low-carbon power generation sources and renewable energy. The government’s support for the development of a gas supply industry and the commercial extraction of coal bed methane will bring numerous benefits to the country, including economic diversification, import substitution, and employment creation. With the potential to become a net exporter of power and a cleaner energy producer, Botswana is poised to make significant strides in its energy sector.