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Lerala mine sale: Enigma to creditors

At least twenty creditors owed BWP P359 million and 148 former employees awaiting payments amounting to close to P9 million by Lerala Diamond mine might have to wait much longer as the mysterious buyer who purchased the mine for P80 million might pull out of the deal.

The mysterious buyer, according to information reaching this publication has cited failure to raise the capital. The mine went on an online auction last month through auctioneers, GInsustry Dovebid. The auction lasted 7 days, opening on May 24th at 5:00 pm until May 30th at 2:00 pm.  The auction included mining and water rights, five Kimberlite pipes ranging from 0.16 hectares to 2.35 hectares in area, a 200 metric tonnes per hour processing plant and a 4.2-megawatt diesel generator, among other assets.

One creditor told this publication that the mine was sold for a song and that there is a possibility of the mine failing to pay an amount of P615 million as claims which are the company’s total liabilities. One of the creditors is the Palapye Sub-Land Board which is demanding over P700 000 in mining lease payments. The land board declined to comment on the developments of Lerala mine auction. The total value of assets on site of the mine is estimated at P251 million.

The 148 former employees of the mine at Lerala village are owed payroll arrears and terminal benefits totaling to close to P8.93 million and most of them wish to have their jobs back.  Botswana Mine Workers Union (BMWU) Secretary General Moffat Ramokate also wonders who the purpoted mysterious buyer could be and whether the new buyer will take back former employees.  

Online auctioneer, GoIndustry DoveBid associate director John Taylor told a diamond industry magazine Rapaport that they received 80 bids for Lerala mine. Last month when the bidding kicked off only twelve bidders had visited the data room that the auctioneers set up to share geology reports and mine data of the mine.

This week Lerala mine liquidator, Kopanang Thekiso would not reveal the name of the mine buyer saying the transactions and the identity would be confidential until the full sale process is complete. He confirmed that the identity is withheld because the actual buyer might pull out of the deal. Thekiso said the auctioneers are currently handling the transfer of mining rights and associated paperwork with regards to the sale. The liquidator also said he is satisfied with the outcome despite some believing that the mine was sold at a low price.

The new buyer will get transfer of the mining license and rights; a complete processing plant, which includes a 200 t/h conventional fines plant and a course dense medium separation plant; final integrated X-ray recovery house; primary jaw crusher; secondary cone crusher; high-pressure roll crusher; scrubbers; material reticulation of conveyors; screens; bins; thickener plant and tailing dams; diesel generator plant; electrical reticulation; workshops; offices; and a mining camp.The Lerala Mine was opened in 2008 and had to be shut twice due to weak sales, until it finally was placed under judicial management in May last year, leaving 130 people out of work and millions in unpaid bills.

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Matsheka seeks raise bond program ceiling to P30 billion

14th September 2020
Dr Matsheka

This week Minister of Finance & Economic Development, Dr Thapelo Matsheka approached parliament seeking lawmakers approval of Government’s intention to increase bond program ceiling from the current P15 Billion to P30 billion.

“I stand to request this honorable house to authorize increase in bond issuance program from the current P15 billion to P30 billion,” Dr Matsheka said. He explained that due to the halt in economic growth occasioned by COVID-19 pandemic government had to revisit options for funding the national budget, particularly for the second half of the National Development Plan (NDP) 11.

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Lucara sits clutching onto its gigantic stones with bear claws in a dark pit

14th September 2020
Lesedi La Rona

Botswana Stock Exchange (BSE) has this week revealed a gloomy picture of diamond mining newcomer, Lucara, with its stock devaluated and its entire business affected by the COVID-19 pandemic.

A BSE survey for a period between 1st January to 31st August 2020 — recording the second half of the year, the third quarter of the year and five months of coronavirus in Botswana — shows that the Domestic Company Index (DCI) depreciated by 5.9 percent.

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Botswana Diamonds issues 50 000 000 shares to raise capital

14th September 2020
Diamonds

Botswana Diamond PLC, a diamond exploration company trading on both London Stock Exchange Alternative Investment Market (AIM) and Botswana Stock Exchange (BSE) on Monday unlocked value from its shares to raise capital for its ongoing exploration works in Botswana and South Africa.

A statement from the company this week reveals that the placing was with existing and new investors to raise £300,000 via the issue of 50,000,000 new ordinary shares at a placing price of 0.6p per Placing Share.

Each Placing Share, according to Botswana Diamond Executives has one warrant attached with the right to subscribe for one new ordinary share at 0.6p per new ordinary share for a period of two years from, 7th September 2020, being the date of the Placing Warrants issue.

In a statement Chairman of Botswana Diamonds, John Teeling explained that the funds raised will be used to fund ongoing exploration activities during the current year in Botswana and South Africa, and to provide additional working capital for the Company.

The company is currently drilling kimberlite M8 on the Marsfontein licence in South Africa and has generated further kimberlite targets which will be drilled on the adjacent Thorny River concession.

In Botswana, the funds will be focused on commercializing the KX36 project following the recent acquisition of Sekaka Diamonds from Petra Diamonds. This will include finalizing a work programme to upgrade the grades and diamond value of the kimberlite pipe as well as investigating innovative mining options.

Drilling is planned for the adjacent Sunland Minerals property and following further assessment of the comprehensive Sekaka database more drilling targets are likely. “This is a very active and exciting time for Botswana Diamonds. We are drilling the very promising M8 kimberlite at Marsfontein and further drilling is likely on targets identified on the adjacent Thorny River ground,” he said.

The company Board Chair further noted, “We have a number of active projects. The recently acquired KX36 diamond resource in the Kalahari offers great potential. While awaiting final approvals from the Botswana authorities some of the funds raised will be used to detail the works we will do to refine grade, size distribution and value per carat.”

In addition BOD said the Placing Shares will rank pari passu with the Company’s existing ordinary shares. Application will be made for the Placing Shares to be admitted to trading on AIM and it is expected that such admission will become effective on or around 23 September 2020.

Last month Botswana Diamond announced that it has entered into agreement with global miner Petra Diamonds to acquire the latter’s exploration assets in Botswana. Key to these assets, housed under Sekaka Diamonds, 100 % subsidiary of Petra is the KX36 Diamond discovery, a high grade ore Kimberlite pipe located in the CKGR, considered Botswana’s next diamond glory after the magnificent Orapa and prolific Jwaneng Mines.

The acquisition entailed two adjacent Prospecting Licences and a diamond processing plant. Sekaka has been Petra’s exploration vehicle in Botswana for year and holds three Prospecting Licenses in the Central Kalahari Game Reserve (Kalahari) PL169/2019, PL058/2007 and PL224/2007, which includes the high grade KX36 kimberlite pipe.

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