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50% Gov’t shares at MDCB

Government’s stake in the Mining Sector, particularly in mining and mineral processing companies is being transferred to state owned Mineral Development Company Botswana (MDCB) and the process is almost complete, Minister of Mineral Resources, Green Technology and Energy Security, Sadique Kebonang has told parliament.


Mineral Development Company, MDCB (PTY) LTD is a company wholly owned by the Botswana Government. The mandate of MDCB is the effective management and optimization of the government mineral investment portfolio in the mining industry. Established in 2015, MDCB fully fleshed and resourced will manage all government shares in the lucrative mining sector. When delivering his Ministry Budget last week in parliament Kebonang said capacitating of the MDCB to fulfill its mandate was ongoing.


“An adequately capacitated MDCB will enable the company to effectively manage Government shareholding in mineral companies,” he said. The Lobatse youthful legislator told parliament that transactions for the transfer of assets from Government of Botswana to MDCB have been completed for Morupule Coal Mine, Debswana Investment SA and BCL.


“The process of transferring the remaining assets namely, Diamond Trading Company Botswana (DTCB), Debswana Diamond Company and Botswana Ash have just started,” revealed Minister Kebonang.He further told parliament that the process was expected to be concluded during 2017.


Under the Mineral Development Company it is expected that managing the government’s mineral sector portfolio would be made easy and more effective as the government stake and interest will be in the hands of a private sector setup that understands the processes and technical knowhow of profit making assets management better. “Capacitating the company is also ongoing with a board in place, the Chief Executive Officer already appointed and recruiting of other staff to build a reputable mineral & mining assets management corporation is in good progress,” Kebonang told WeekendPost in an interview this week.


When it commenced operations MDCB immediately took over government shares in BCL, a move said to have been easy as Botswana Government was the largest shareholder with a controlling stake of over 90 %. Mid 2016 before the shocking news of BCL liquidation MDCB bought out Botswana-DeBeers joint venture Debswana Mining Company from Morupule Colliery Mine (MC).

According to ongoing plans theCorporation willsoon sit in a boardroom with Anglo American as it isreplacing government in Debswana Diamond Mining Company, one of the wealthiest mining companies in the world. The Government of Botswana owns a 50% stake in Debswana which owns Jwaneng Mine which is the world’s richest mine by value and Orapa Letlhakane & Damtshaa Mines. Orapa plant is the World’s largest diamond processing plant. Once the transfer of Shares is Complete MDCBwill also control Botswana’s 50% stake in Diamond Trading Company, Botswana Ash as well as 15% of Botswana Government in the De Beers Group.


Mineral Development Company Management


Reginah Sikalesele-Vaka is the Board Chairperson of Mineral Development Corporation. Vaka is a renowned financial expert and insurance industry guru and the founding Chief Executive of Bona Life, Botswana’s 1st citizen owned Life Insurance Company. Vaka is expected to guide the Botswana mineral sector lucrative ship to diversity and maximum beneficiation. Once MDCB holds all government shares in the mining sector the company is expected to transform the entire mineral sector and also make investments to create wealth and increase state revenues.


Other MDCB Board members include former State President Sir Ketumile Masire’s son Mmetla Masire. Masire, an environmental engineering guru by academic qualifications is currently also handling a task with a day to day job of transforming Botswana’s national water supplier, Water Utilities Corporation (WUC ) which is currently holding a record of one the most perennial loss making businesses in Botswana.

 

Vaka also sits with Sebetlela Sebetlela, one of Botswana’s renowned mining experts. Sebetlela currently is chairman  of BPC board, he has literally  captained all mining companies in Botswana, from Orapa, Tati to Jwaneng just to name a few.Other MDCB board members include MatomeTsholetsa, Country Manager for Joy Global Inc.


The Chief Executive Officer of MDCB is Paul Smith, a renowned mining sector profit maximizing guru with footprint across Africa. Smith made his name in South Africa’s lucrative Platinum mining sector. Last year, immediately after government acquired a 50 % stake of Morupule Colliery Mine, Smith allegedly got the ball rolling to mastermind the liquidation of Botswana’s oldest Mining Company, BCL. BCL was put under provisional liquidation on October 9th 2016.Smith, according to media publications is one of, if not the highest paid CEOs in Botswana alongside BPC Chief Executive Officer with over P100 000 as take home per month.


Minerals sector performance


According to Minister Kebonang the mining industry experienced a global commodity price downturn over most of the first two quarters of 2016, in mainly the base metals and energy minerals. However, diamond markets improved during the first quarter of 2016 and this resulted in actual sales exceeding production due to sale of inventory from the year 2015.


“Mineral revenue (dividends and royalties) for 2016 increased by 63% when compared to 2015. The average percentage contribution of minerals to GDP during second quarter of 2016 was 21.8% compared to 18.4% in 2015,” parliament heard last week. Debswana Diamond Company produced 20.9 million carats in 2016 compared to 20.4 million carats in 2015. Sales were 26.3 million carats compared to 14.7 million carats in 2015. Revenue from these sales was USD 3.9 billion and this compared favourably to USD 2.4 billion in 2015.


Kebonang also reported that Boteti Mining Company produced 307 thousand carats in 2016 compared to 377 thousand carats in 2015. “Boteti upgraded their processing plant, which enabled them to recover exceptionally large stones. Despite the volatile diamond markets, Boteti mine continue to perform well,” he said.


Ghaghoo Diamond Mine produced 20.6 thousand carats in 2016. Lerala Mine resumed production in April 2016 and has so far produced 58.5 thousand carats and so far made two sales. The performance of base metal mines continued to decline in 2016 due to depressed commodity prices.

Copper and nickel prices showed improvement from US$ 2.06/lb to US$ 2.65/lb for copper and US$ 3.80/lb to US$ 5.20/lb for nickel respectively from December 2015 to December 2016. However the prices remain a challenge for the marginal operations. BCL and Tati Nickel Mining Company were placed under provisional liquidation in October 2016 due to severe financial distress.


Kebonang is of the view that there are notable developments in the energy minerals sub-sector as companies continue to show interest in the energy minerals. “For instance, A-Cap Resources and African Energy Resources Botswana have acquired mining licenses for uranium at Sese and coal at Makomoto, respectively.”  


Kebonang said MDCB will be looking to invest inorder to diversify government revenue within the mining sector to reduce dependence in the Diamond segment. Soda Ash and Salt sales were 288.5 thousand tonnes and 435 thousand tonnes respectively in 2016 compared to 258.9 thousand tonnes and 368.9 thousand tonnes for corresponding figures in 2015. Currently Production of soda ash and salt continues to be constrained by low off-take.

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Business

The Bulb World starts operations in South Africa

8th April 2021

Homegrown LED light manufacturing company, The Bulb World, has kick started operations in South Africa, setting in motion the company’s ambitious continental expansion plans.

The Bulb World, which was partly funded by Citizen Entrepreneurial Development Agency (CEDA) at the tune of P4 million, to manufacture LED lighting bulbs for both commercial and residential use in 2017, announced last year that it will enter the South African market in the Special Economic Zone (SEZ) of North West province under the auspices of North West Development Corporation (NWDC).

The company has already secured a deal with South Africa authorities which entails production factory shells and tax incentives arrangements.

The company founder and Chief Executive Officer, Ketshephaone Jacob has also previously stated that the company is looking for just under P50 million to finance its expansion strategy and is reaching out to institutional investors such as Botswana Public Officers Pensioners Fund (BPOPF) and government investment arm, Botswana Development Corporation (BDC).

However, Jacob told WeekendPost that instead of sitting and waiting for expansion funding the company has started hitting the ground running.

“We have decided to get in the streets of SA, start selling lights from door to door, ” said Jacob who is in currently in Rusternburg to oversee the introduction of The Bulb World products in the market.

Jacob explained more brand activations will be undertaken in South Africa. “The plan is to do it the whole of North West and Limpopo province, through hawkers, we give the hawkers the lights to sell at a factory price and they put a mark up and make a living,” he said.

The Bulb World operates from Selibe Phikwe, it currently employees 65 young people, 80 % of which are Phikwe youth. The company plans to add 100 jobs this year alone as it forges ahead with its regional and continental expansion plans.

In July this year Bulb World products will hit South African Shelves:  Pick n Pay, Checkers and Africa’s largest retailer Shoprite.

The Bulb World has been registered as a company in South Africa; the company will start producing lights from Mogwasa after striking a special economic zones deal with North West Development Corporation in North West Province South Africa.

“Over the next 10 years we are looking to create over 5,000 jobs in Africa. Through our expansion into all of Africa we will be able to create employment for various individuals in different sectors namely; manufacturing, distribution electronics and retail,” Jacob told this publication earlier this year.

Jacob said if all goes well, the plan is to have taken over Africa or rather penetrated, and have prevalent presence in the African market.

“We are gunning to have at least 30 percent market share by then. According to a 2016 Market Survey, the total valuation of sales for LED Lighting was 57BN, a portion of which we plan to have taken over by then,” he said.

 

While the company has set its eyes on Africa, Jacob said, the company has not fully exploited its local growth, indicating that there could be strategic factories built to supply neighbouring countries of Angola and Zimbabwe.

“There is potential for further local expansion as well to other areas of Botswana if things run smoothly as anticipated. Hopefully in the long-term if our fellow Africans and all these markets receive us well we are planning to build another factory,” he said.

“We are looking to build another factory in the Chobe/Ngamiland Area that will give priority to markets in Zimbabwe and Angola,” he said

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Business

‘Oil exploration will have minimal impact’

30th March 2021
Okavango-River-Basin

The Maun based Okavango Research Institute (ORI) has downplayed the impacts of oil and gas exploration in part of Okavango delta arguing that given the distance proposed the likelihoods of negative impacts drilling these exploration wells on the surface water systems is likely to be negligible.

The Institution released a position paper titled ‘Proposed Petroleum (Oil and Gas) Exploration Operations in the Petroleum Exploration License (PEL) No. 73,’ with findings stating that, in the event of discovery of economically viable hydrocarbon deposits, much more careful consideration of the impacts and economic benefits of development of the resource will be needed.

For example, the fracking process for gas and oil extraction is known to require large volumes of underground water.

It further argues that increased extraction of the underground water is likely to affect the water table level and further affect the overall water availability in the river-basin.

“The effect on water availability and use may become worse if surface water is reticulated or sourced by any means from the Kavango River. Should the exploration and fracking for oil and gas expand to Block 1720, 1721 and 1821, the impact on water availability and quality will be significant, especially if the wastewater is not well managed,” said the paper.

The research unit recommends close communication between the relevant Basin State Ministries (Mineral Resources, Environment) and the Permanent Commission on the Okavango River Basin, OKACOM, and other stakeholders must be facilitated.

This will facilitate sharing of the correct information on the desired intentions of the basin states and compromises sought for the sustainability of the ecosystems in the downstream of the Cubango-Okavango river Basin, states the position paper.

ORI as a key stakeholder with scientific information says it is positioned to provide scientific advice and guidance to decision-makers on the potential impacts of both exploration and development and operation activities.

It also recommends that while the impacts might be minimal at the exploration stage, environmental impacts during the development and extraction process are significant.

Findings also state that the SADC Protocol places a mandatory duty to make a notification of planned measures undertaken in any riparian state in cases where such measures hold the potential to cause ‘significant adverse effects.’

It further states that where the planned development is trivial and not expected to cause any significant harm, the development state is not under duty to notify other riparian states.

Given that the drilling in the Kavango Region in Nambia is merely for exploratory purpose and the possibility of harm is minor, it is therefore not surprising that the Namibian government did not inform Botswana.

However, should it be found that the oil can be profitably or economically exploited, the Namibian government would be under a duty to notify both Angola and Botswana.

The institution further states that to ensure sustainable development in the Okavango Delta the following in the context of exploration for and potential development of hydrocarbon deposits within the Cubango-Okavango River Basin, it must be considered that the Okavango Delta is a World Heritage Site listed in 2014 by UNESCO and one of the binding requirements of the listing is the non-permissible commercial mining of any mineral, gas or oil within the World Heritage Site.

It states that the Okavango Delta is also a RAMSAR site in which mining is not allowed.

Should the exploration for minerals, oil and gas be allowed, there is a high chance that a mineral, oil or gas may be found given that the Delta is sitting on karoo sediments and shale rocks which in other parts of the world have been found to be sources of oil and gas deposits. Should oil or gas be discovered, there will be a strong socio-economic pressure to mine oil or gas and create jobs for the masses.

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Pakmaya yeast penetrates local market

30th March 2021
Pakmaya Africa Sales Manager: Cem Perdar

Manufactured in Turkey, Pakmaya Instant Dry Yeast can be used in the production of various fermented products, as it is suited for both traditional and industrial baking processes. All kinds of breads, buns and fermented pastry products are typical examples of applications.

Pakmaya Africa Sales Manager Cem Perdar says Pakmaya has 4 plants in across the world, further indicating that all of the plants have the highest standards of quality certificates and approvals. Regarding raw material, molasses is the main ingredient for yeast. Concerning production activities, yeast manufacturing requires high know-how and capability. Pakmaya has all those capabilities and aspects more than 45 years.

According to Perdar, Pakmaya has been existent in African markets since 30 years. From South to North, Central to East and West, a consumer can find Pakmaya in nearly every part of Africa continent.

“With its high quality, rich product selection and good service, our brand has become the favorite yeast of many Africans. On the other hand, our distributors in African countries are working very hardly and loyally in order to promote our products in their markets. After some time, we are becoming like families with our exclusive distributors in Africa and this enables both parts to work harder and keeps our product sustainable in market,” he said in an interview this week.

The yeast manufacturing giant made its way to Botswana market. The company has been smoothly working with Kamoso Distribution, a local distribution company. Perdar told BusinessPost that two entities have been working hard to earn is market locally.

“At the moment we have a good market share with them in Botswana market. I’m sure during 2021 long, we will be increasing our sales and market position. Soon we are going to start a marketing campaign in Botswana, so that means Batswana will see and recognize Pakmaya more and more. Pakmaya wants to be the best friend of bakers in bakeries and ladies at homes in Botswana.”

As per global COVID-19 regulations to curb the spread of the COVID-19, Botswana just like other country closed borders. Providentially, the restrictions did not affect the company destructively.

Perdar says “Kamoso Africa is a very important and strong partner in Botswana territory. With Kamoso’s hard work and strict measurements, we have done a very good job. So as Pakmaya, we have not suffered any distribution problem. Our partner is doing the needful at the reaching our products to end users.”

He further said “We are doing well in Botswana market and hoping to make much more. Our aim is to enter every single corner in Botswana territory. With our new marketing campaigns, we are planning to be the most preferred yeast in Botswana market.”

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