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Gaborone Hilton Hotel gets the nod

The Botswana Public Officers Pension Fund (BPOPF) and Messidor Investment have been given a nod by the Hilton Group to go ahead with the construction of the hotel worth P300 million. The approval comes after the Hilton Group was impressed with the mock-up room that was constructed to display the interior design of the rooms.


The Mock-up room was commissioned by the group to ensure that the new hotel will have the same look and feel like other Hilton hotels so as to maintain consistency. Furthermore, the mock-up room was necessary for the Hilton Group to ascertain if the first Hilton Hotel in Botswana meets their standard global brand. At a press briefing, it was revealed that the Hilton Group has inspected the mock-up room and gave a go ahead after making comments and suggestions.


“We have reached a milestone with our Hilton Hotel project following approval by the Hilton Group. The project now commences and we will be working on a strict schedule,” said Ms. Boitumelo Molefe, BPOPF CEO. Ms. Molefe was accompanied by Mr. Victor Senye and Harry Fleetwood-Bird, both from Messidor Investment, the company that will be managing the project. Mr. Senye reiterated the BPOPF CEO’s words that they have reached a real milestone in terms of the development of the hotel.


“We have met the specifications by the Hilton Group through our mock-up room and they have approved the specifications as it meets the set quality assurance standards,” explained Mr. Senye before adding that following the Hilton Group’s review, the real work now begins. “Through the mock-up room we gave them a feel of the product. Now we have to pull up our sleeves and deliver.”


The mock-up room will be demolished as construction commences in full force. Messidor Investments has tapped GM Five as the main contractor for the development of the two buildings. According to Mr. Senye, the development consists of offices and the hotel with both structures to be built concurrently. It was also revealed that the envisaged 4-star hotel will have a total of 153 rooms made up of 6 suites and 147 standard rooms. Situated at the heart of the nation’s new central business district (CBD), the Hilton Hotel will attract travelling business people, and the addition of offices by the developer will enhance convenience.


The media was taken on the tour of the mock-up room to give them exclusive view of how the hotel rooms will look after construction is complete. During the inspection of the room, it was also explained the process that went behind building the structure. Mr. Harry Fleetwood-Bird says in constructing the hotel, the Hilton Group’s brand standards had to be adhered to so as to maintain consistency with rest of the Group’s hotels.


“The Hilton Group is strict on its brand globally, and they want to maintain the same look and feel. Even the sizes of the rooms are determined by the Hilton Group. This mock-up room has been designed to match the Group’s specifications.” Mr. Fleetwood-Bird said that although it is a 4-star hotel, the materials to be used in the rooms are of the highest quality, a development which easily puts the new hotel on par 5-star hotels. Perhaps to emphasize his point, Mr. Fleetwood-Bird said the doors to be used are one of a kind and not readily available in Africa, and indication of the Hilton Group’s strict specifications on maintaining consistency. 


The hotel which is expected to be completed by end of November will feature state of the art technology that will ensure that the hotel is eco-friendly and they have gone to great lengths to ensure that each room will be sound proof to prevent disturbances to guests.
“Of course in a project of this size there will invariably be delays but we are fortunate not to have experienced major delays except for the recent rains but we are in talks with the main contractor to push the schedule up which might involve working at night,” explained Mr. Fleetwood-Bird.


It is expected that after the main contractor finishes with the construction in November, the second phase will involve interior fittings and commissioning of the hotel staff, and then followed by a testing phase to see if everything works according to plan.  The process is estimated to take three months, meaning the hotel will be fully operational in early 2018.


Meanwhile, Mr. Fleetwood-Bird says by meeting the Hilton Group’s specifications regarding the development of the hotel, they have not deviated from BPOPF’s clear instructions which required that there should be strong citizen participation in the project. “BPOPF is strict about citizen participation, and that involves buying locally. We have more than 300 citizens on site,” he said and added that a balance had to be made in relation to meeting Hilton Group’s demands and those of BPOPF.


The P300 million Hilton project was commissioned in 2015 after BPOPF signed an agreement with the Hilton Worldwide for the first Hilton Hotel in the country. Around that time, it was announced that the 4-star hotel will be called Gaborone Hilton Garden Inn Hotel and the project was to be managed by Flemming Asset Management. However relations between BPOPF and Fleming broke down last year amid allegations of Flemming sidelining local contractors, an occurrence that went against BPOPF’s wishes.


Matters soon took a turn for the worst when BPOPF cancelled contracts worth billions with Flemming on the back of a financial scandal that hit the company. There were unconfirmed allegations that BPOPF’s funds managed by Flemming might have been exposed to unnecessary risk. Despite the fall down between the parties, BPOPF agreed to keep Flemming as a project manager for the hotel development.


The decision was short lived as BPOPF ended up severing all ties with Flemming, announcing that the Fund has been working with Fleming on transitioning the development of the Hilton to its property manager Messidor Investment. Ms. Molefe at the time explained that given the magnitude of the project, it was critical that the transition is as smooth as possible.


Messidor Investment, a joint venture between Botswana Insurance Fund Management (BIFM), Stocker Fleetwood-Bird and Haighs Investments, is a special purpose vehicle responsible for managing the property portfolio of BPOPF. On the other hand, BIFM is a subsidiary of the financial giant Botswana Insurance Holdings Limited. BIFM also manages some of BPOPF’s billions. Haighs Investments is a property development company managed by Mr. Senye, a former BIFM CEO. Stocker Fleetwood-Bird specialises in property consultancy, development and valuations. The company is partly owned by Mr. Fleetwood-Bird.

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The  Bulb World CEO selected for Africa’s prestigious award

22nd July 2021

The Bulb World Chief Executive Officer (CEO) and entrepreneur, Ketshephaone Jacob has been selected as a 2021 Top 50 Africa’s Business Hero.

Jacob was chosen from a pool of 12,000 applicants – many of whom are highly-skilled and accomplished entrepreneurs.

Africa’s Business Hero, sponsored by technology entrepreneur, Jack Ma, aims to identify, support and inspire the next generation of African entrepreneurs who are making a difference in their local communities, working to solve the most pressing problems, and building a more sustainable and inclusive economy for the future.

The initiative is as inclusive as possible and applications were open in English and French to entrepreneurs from all African countries, all sectors, and all ages who operate businesses formally registered and headquartered in an African country, and that have a 3 year-track record.

Every year, finalists are selected to compete in the ABH finale pitch competition and participate in a TV Show that will be broadcast online and across the continent.

The finalists will compete for a share of US $1.5 million in grant money.

The Bulb World, is home grown LED light manufacturing company, 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.

The Bulb World operate from the Special Economic Zone of Selibe Phikwe. Early this year, The BulB World announced its expansion to South Africa, setting in motion its ambitious Africa expansion plan.

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Mining production down 12 % IN Q1 2021

14th July 2021

During the first quarter of 2021, production in Botswana’s economic nucleus- the mining sector contracted by 12 percent. This is according to Mining Production Index released by Statistics Botswana this week.

The country’s central data body revealed that Index of Mining production stood at 74.4 during the first quarter of 2021, showing a negative year on-year growth of 12.0 percent, from 84.6 registered during the first quarter of 2020.

The main contributor to the decline in mining production came from the Diamonds sector, which contributed negative 11.7 percentage points. Soda Ash was the only positive contributor in the mining production, contributing 0.1 of a percentage point. However Soda Ash’s contribution was insignificant to offset the negative contribution made by Diamonds.

The quarter-on-quarter analysis by Statistics Botswana experts shows an increase of 16.3 percent from the index of 64.0 during the fourth quarter of 2020 to 74.4 observed during the period under review.

Diamond production decreased by 12.1 percent during the first quarter of 2021 compared to the same quarter of the previous year. The decrease was as a result of planned strategy to align production with weaker trading conditions mostly linked to Covid-19 protocols restrictions.

Botswana’s diamond sector is underpinned by Debswana, the country’s flagship rough producer- a 50-50 joint venture between government and global mining giant De Beers Group. The other producer is Canadian based Lucara Diamond Corp through its wholly owned Karowe Mine which is a relatively small but significant production that has made a name for itself worldwide with rare diamond recoveries of unprecedented carat size.

On the other hand, quarter-on quarter analysis shows that production has improved, registering a positive growth of 17.5 percent during the first quarter of 2021 compared to the preceding quarter – 2020 Q4.

Though production was significantly lower in the first quarter, the two producers ended Q2 with rare diamond recoveries. Debswana early last month found the world’s third largest gem diamond – weighing 1098 carat at Jwaneng Mine, its flagship gem quality diamonds producer, also regarded the world’s richest diamond mine.

A week later Lucara  announced its second biggest recovery, the 1174 carat clivage near-gem dug from its Karowe Mine. The diamond is the world third in carat size after the plus-3000 carat Cullinan found in South Africa back in 1905 and the 1758 carat Sewelo unearthed at its Karowe mine in 2019. Debswana and Lucara are investing billions of pulas in underground mining projects to extend the life of its mines, Jwaneng & Karowe respectively.

In terms of Gold which is produced at Mupani mine near Botswana’s second city of Francistown output decreased by 17.9 percent during the first quarter of 2021 compared to the same quarter of the previous year.

Similarly, quarter-on-quarter analysis reflects that production decreased by 21.4 percent during the first quarter of 2021, compared to the preceding quarter. The decrease was as a result of the deteriorating lifespan of the mine as well as the impact of COVID-19 which slowed down the mining activities.

Soda Ash production increased by 11.1 percent during the first quarter of 2021 compared to the same quarter of the previous year. In terms of quarter-on-quarter Soda Ash production also showed an increase, picking up by 2.1 percent during the period under review. The increase in production is attributable to the effectiveness of the plant following refurbishment which occurred in the third quarter of 2020.

Salt production decreased by 34.0 percent during the first quarter of 2021, compared to the same quarter of the previous year. Similarly, the quarter-on-quarter analysis shows that salt production registered a decrease of 32.9 percent during the period under review. Both salt and Sodash are produced by partly government owned Botswana Ash (BotsAsh) operating from Sowa town near Makgadikgadi pans.

Coal production decreased by 11.2 percent during the first quarter of 2021, compared to the corresponding quarter of the previous year. The decrease was attributed to the reduced demand from Morupule B Power Station following the remedial works being undertaken, as one boiler was in operation during the period under review.

Although production fell, Statistics Botswana says there was no shortfall in supply of coal due to stockpiling. On the other hand, the quarter-on-quarter comparison shows that coal production increased by 20.4 percent compared to the preceding quarter.

Botswana’s flagship coal producer is Morupule Coal Mine; a wholly state owned mining company located in Palapye producing primarily for Botswana Power Corporation (BPC)’s power generation plants Morupule A & B.

The other coal producer is Botswana Stock Exchange listed Minergy which operates a 390 MT Coal Resource mine in Masama near Media in the southwestern edge of the Mmamabula Coalfields.

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Gov’t awards mining licence for Gantsi Copper Mine

14th July 2021
Moagi

Department of Mines in the Ministry of Mineral Resources, Green Technology & Energy Security has awarded mining licence to Tshukudu Metals-a subsidiary of Aussie firm Sandfire Resources ,giving the company a green light to start piecing the ground at its Motheo Copper Project near Gantsi.

Lefoko Moagi, minister in charge of mineral resources in Botswana confirmed to weekendpost on Tuesday. Minister Moagi revealed that “the licence has been approved , but Sandfire Resources as a listed company will report to its shareholders and investors then make an official public statement” he said.

Based on a forecast copper price of US$3.16/lb (reflecting current long-term consensus pricing) the Base Case 3.2Mtpa – Ghantsi copper project is forecast to generate US$664 million (over P7 billion) in pre-tax free cash-flow and US$987 million (over P10 billion) in EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation), at a forecast all-in sustaining cost of US$1.76/lb over its first 10 years of operations.

In December 2020, the Board of Sandfire Resources approved the commercial development of the Motheo Copper Mine located in the Kalahari Copper Belt in Botswana, marking a key step in its transformation into a global, diversified, and sustainable mining company.

Tshukudu Metals Botswana (Pty) Limited (Tshukudu) a 100% owned subsidiary will be the owner and operator of the Motheo Copper Mine which is scheduled to produce up to 30,000 tonnes per annum of copper in concentrate over a 12 year mine life.TMB is targeting development of its Motheo Copper Mine in 2021 and 2022, with its first production in 2023.

GOVERNMENT NOT TAKING UP 15 % STAKE ON OFFER

Beginning of this year presentations were made to the Department of Mines as part of the Mining Licence approval process and to the Ghanzi Regional Council, additional information was requested by Department of Mines in April and was duly supplied by the company.

As part of the Mining Licence approval process, the Government of Botswana has a right to acquire up to a 15% fully contributing interest in all mining projects locally. Quizzed on whether government through Mineral Development Corporation Botswana (MDCB) would be taking up stake in the project Minister Moagi said, “No consideration is being made on that regard”.

“Government is not considering taking up a stake in the Ghantsi Copper Mine project, every opportunity is assessed on all risks, but Government makes money all the while from leases, taxes and royalties, remember if you take stake you are liable for liabilities of the project as well,” Moagi said.

MINING CONTRACT

Last month Sandfire announced that it has awarded over P5 billion worth mining contract to African Mining Services (AMS), a subsidiary of Perenti, to deliver the open cast operation.

The contract, which has an estimated value of US$496 million (over 5 billion), is the largest single operational contract for the new Motheo Project covering a period of 7 years and 3 months, with provision for a one-year extension.

The contract according to Sandfire Resources was awarded following a competitive 3-stage tender process which saw a number of key factors taken into consideration when selecting the preferred contractor.

These included Citizen Economic Empowerment, safety culture, equipment suitability and availability, commercial terms and identified improvement opportunities. Under the terms of the contract, AMS has agreed to form a 70:30 Joint Venture with a suitable local Botswana partner or partners.

The JV is expected to be finalized ahead of commencement of mining in early 2022. African Mining Services has been operating in Africa for over 30 years. AMS’ parent company, ASX listed diversified mining services group Perenti, already has a presence in Botswana through Barminco, their underground mining division, at the large-scale Khoemacau Copper Mine located 200km north-east of Motheo.

Last month Sandfire executives said the award of the open pit mining contract represents another key milestone in advancing the Motheo Project towards production, with all components of the contract in line with the key parameters outlined in the December 2020 Definitive Feasibility Study (DFS).

The company said full-scale construction of the US$279 million (over P 3 billion ) mine development is expected to commence immediately upon receipt of the Mining Licence, with mining scheduled to commence in early 2022 ahead of first production in early 2023. This week Sandfire Resources advertised over 10 positions in calling on applications from geologists, mining engineers and geotechnical engineers.

The Motheo mine has an initial mine life of 12.5 years based on production from the T3 pit. The initial development is expected to generate approximately 1,000 jobs during the construction phase and 600 direct full-time jobs during operations, with at least 95% of the total mine workforce expected to be made of up of Botswana citizens.

Later in the week Sandfire Resources announced in the company website that it has received the licence. Sandfire’s Managing Director and CEO, Mr Karl Simich, said the award of the Mining Licence represented a major milestone that would see a significant increase in construction and development activities on site.

“We are absolutely delighted to now be in a position to move to full-scale construction at Motheo, with our construction crews expected to mobilise to site over the next few days. I would like to thank the Government of Botswana for their support throughout the approvals process, which will see Motheo come on-stream in 2023 as one of very few new copper mines commencing production globally.”

Simich said the project is expected to generate approximately 1,000 jobs during construction and 600 full-time jobs during operations, and represents the foundation for Sandfire’s long-term growth plans in Botswana.

“Our vision is that Motheo will form the centre of a new, long-life copper production hub in in the central portion of the world-class Kalahari Copper Belt, where we hold an extensive ground-holding spanning Botswana and Namibia,” he said.

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