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Politics of the 50 billion Pula CTL project

“Government is also exploring other options to improve fuel supply security by developing a Coal to Liquids (CTL) project which is at feasibility stage and is expected to be completed during the course of 2021.To further ensure national security of fuel supply, additional strategic fuel storage facilities are being developed through Botswana Oil Limited (BOL) in Ghanzi, Francistown and Tshele Hill in the Kgatleng district.”

This statement has hit former legislator, Samson Guma Moyo right in the heart, “that is my project,” he screams as he tries to explain that the Coal-to-Liquids project mentioned in President Dr Mokgweetsi Masisi’s State of the Nation Address is his. This is an extract from President Masisi’s address to Parliament last week and Guma Moyo is concerned that “the President has not been given accurate information.” [ihc-hide-content ihc_mb_type=”show” ihc_mb_who=”1,2,3″ ihc_mb_template=”1″ ]

As things stand, the former Tati East Member of Parliament is at war with Shumba Energy over what he terms, “breach of contract” following the latter’s failure to pay him P50 million due to COVID-19 disruptions. Pressed further Guma said they have so far pumped in $12 milliion into the project. The CTL project is still at feasibility studies level. He said they have been on this project for five years and spent P10 million on feasibility studies.

Guma expressed shock at summations that the project could be delivered by next year (2021) noting that, “this is a dream that will never come true.” He indicated that the total estimated cost of the project is $4.45 billion, which he said is a clear sign that Botswana does not have the capacity to implement at Government level. “As we speak funders are not keen on coal projects because of the ongoing debate on climate change issues. It is very likely that we are going to struggle to get funding for the completion of this project,” he said.

In Guma’s estimation $4.45 billion, which is likely to escalate with time, would be heavy on Botswana’s balance sheet. Reverting to his conflict with Shumba energy, Guma said they were of the view that as a listed company, Shumba would create value for the project. Since Shumba has not been able to pay the agreed P50 million upfront, Guma said they have notified BOL that the project is back in his custody and they are looking at starting with a 256 MW power station that will be a separate subsidy to kickstart the business.

Guma and his partners are looking at utilizing the Eastern Corridor which goes through Mozambique to build Botswana’s very first commercial oil refinery. But the climate change debate remains a stumbling block.  According to those leading the climate change debate, coal is the single biggest contributor to anthropogenic climate change.

They say the burning of coal is responsible for 46% of carbon dioxide emissions worldwide and accounts for 72% of total greenhouse gas (GHG) emissions from the electricity sector. But transitioning from coal or stopping all coal all together is not as easy as launching a website to campaign against coal usage. Globally, the coal mining industry alone employs about 8 million people and creates revenues of more than US$900 billion a year.

While the environmental and health effects of coal are well understood, policymakers in newly industrializing countries often highlight the importance of coal for industrial development in specific regions. Countries faced with unemployment challenges such as Botswana cannot afford to shut out coal as the moment because they will be forced to bring substitute industries to absorb coal miners.

In any case policymakers need to understand in more detail who will be affected by a transition away from coal, how these societal groups can be effectively compensated and how powerful vested interests can be counterbalanced. President Masisi’s push for the Coal-to-Liquids project is not without basis, it could create numerous opportunities and jobs in the country. However the nagging matter of Guma versus Shumba Energy could be put off the way to allow full introspection and possible implementation of the project.

BUT WHAT IS THIS P50 MILLION GUMA WANTS FROM SHUMBA?

Samson Moyo Guma and Mmoloki Tibe are locked up in a dispute with Shumba Energy regarding the ownership of Coal Petroleum (Pty) Ltd and an outstanding payment of P50 million.

Guma and Tibe are shareholders, co-founders and Directors of coal Petroleum (pty) Ltd, with initial 50:50 share split between them. They had subsequently engaged Holland and Hausberger (H and H) to prepare a Pre-Feasibility Study for them which was fully paid for. As the project progressed, they gave H+H 10% shares in lieu of consultancy fees, resulting in shareholding of 45:45:10, for Guma, Tibe and H and H, respectively.

The two have written a letter to Botswana Oil Limited Chief Executive Officer, Mr Gamu Mpofu to notice him of their dispute with Shumba Energy. According to Guma and Tibe, they carried out a lot of work to progress the project including Pre-Feasibility Study, securing 295.5ha land for the project, carried out Geo Tech, commenced EIA, signed MOU’s with Wison and Power China, responded to BOL Tender, etc. the result was a company with a valuation of USD12M.

But where does Shumba Energy come in, according to communication between Guma, Tibe and Botswana Oil Limited, Shumba Energy approached them to acquire 80% shares in the company on terms contained in various transaction agreements.

Key to this agreement was the understanding that Shumba Energy will make available a loan of P50m (through a Bridging Loan Facility Agreement) in 3 days after Coal Petroleum fulfilment of the transaction conditions. The loan was to take the project to Financial close (FC), which will ensure that Guma and Tibe are paid the value of their shares, being USD5.2m, USD4, 2m for Guma and Tibe, respectively.

According to documents seen by this publication these amounts were arrived at by taking 80% the value of the company of USD12m (USD 12*80%), with Guma selling 45% (45% of USD9.6m = USD5.4m) and Tibe selling 35% of USD9.6m = USD4,2m).

Further, a payment of R100, 000 and P50, 000 on a monthly basis, being out of pocket expenses for Guma and service level payments (for work done since inception to the time of the transaction) for Tibe, respectively were to be made by Shumba.

The two businessmen also claim that there are also some amounts relating to work completed and/or on going at the time of the transaction which were to be paid out of the loan facility of P50m. “These amounts includes balance of Geo Tech, work done on EIA, and Lease for the land, etc.”

They state that these amounts remain outstanding due to the fact that the loan facility has still not been made available more than 6 months later. In the meantime, we, not Shumba, continue to receive reminders to pay and this makes us look bad and tarnishes our good names with service providers who were to be paid from the loan facility provided.

According to documents seen by this publication, “Other costs still to be paid includes Bankable Feasibility Studies conducted by Power China and Wison, Design work and ongoing consulting work. Without the P50m loan facility these critical aspects of the project will not be completed, not only on time, but also that there is risk that the project will not progress beyond the point we handed it over to Shumba, except for RFQ’s as and due diligence initiated by BOL.

There is need to emphasise that we only agreed to transfer the shares to Shumba on the commitment to make available the P50m loan facility available within 3 days in the interest of the project and the perceived benefit to the country.”

Guma and Tibe inform Botswana Oil Limited that they believe that they were misled and as the P50m loan facility was a deal breaker for them, they believe the sale of the shares is null and void and therefore not bound by the agreements signed.

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BOMU, DBS roadshow partners in crime

18th March 2024

The Department of Broadcasting Services (DBS) roadshow has found and trusted the Botswana Musicians Union (BOMU) as a companion it could trust in empowering and facilitating the creative sector, in particular, performing artists and musicians.

BOMU exits to ensure that musicians in Botswana are supported by all platforms and services that are aligned to what they do, which at most times is the production of music.

In 2023, the Union put together grand music awards prized at a whooping P3 million. Indeed, the man working behind the awards, Seabelo Modibe of Total Music Group understood the assignment. For the very first time, BOMU awards left an impressive mark, leaving people murmuring.

With that said and done, BOMU became a very important stakeholder in the on-going DBS roadshow. The relationship started in 2022 when the project was initiated. In this massive project, BOMU plays a role of mobilizing and registering new artists.

In the previous years, the Union has been clouded by dispute and back-and-forth. It was accused of being bungling, purposeless and served no interests of its members (artists). Following the effective execution of the eleventh music awards, artists progressively joined BOMU and the DBS roadshow added cherry on top.

Some of the artists who made it to the Top 30 of the DBS roadshows much-admired the platform, saying it played a major part in changing their lives. Some of them started getting booked, changed their mindsets and consider music as a business entity.

These are some of the few nuggets of wisdom they raked from the man behind the roadshow, Thato Sikwane. He is known as DJ Fresh in the music sector and his company, Big Dawg Productions is the brainchild behind the DBS roadshow.

Matter of fact, DJ Fresh and Modibe worked on this concept together with an aim of unearthing new talent in as much as music is concerned. In order to achieve this goal, the duo had to engage BOMU to allow for the artists to have a body that governs them.

When speaking in an interview with WeekendLife, BOMU Secretary General Rasina Rasina said the roadshow is actually a blessing in disguise, as it was initially considered a tall show.

“This is a much-needed platform for a sector that has been deteriorating over the years. We believe it is here to resurrect the music industry. The DBS roadshow cultivate talent from scratch and nurtures it. This will help us as a Union to have a solid foundation and as BOMU, as we are highly appreciative.”

Rasina said BOMU is very much aware of Season One challenges, adding that they too experienced them. “As BOMU, we therefore appreciate that it was the beginning. Naturally, beginnings have challenges but we are optimistic that everything will be in order as together as a team, we can work to solve all pressing matters that delay the progress of artists in Botswana.”

Successful artists during the DBS roadshow will reap from what they sow. BOMU has been allocated a budget to help artists access the roadshow. Rasina has however refused to divulge the total amount but specified that they ensure artist participation and mobilization, as well as feeding.

“We have learnt from past challenges. We do not pay artists but we assist them with transportation funds to mobilize them to attend the roadshow and showcase. What we offer them is not payment. We ensure their participation, transport mobilization and feeding. They compete, showcase and get the platform they need. We partner with them to deliver a product. Essentially, there is a car, a record deal, airtime deal and cohesion.”

Thus far and during the Season 2 roadshow, BOMU has registered an average of five hundred (500) members. In the process, it has managed to rebuild an average of ten BOMU District chapters nationwide.

Rasina commended the government for coming up with a project that caters for the welfare of artists and creative minds in Botswana.

“Our expectations from the next season is that it will be bigger and better. We appreciate the contribution of DBS and the recent focus towards the creative industry by government. Importantly, it is important to note that the creative industry should never be treated from a blanket approach view. Every region, district, village or town has its own talent. The heritage of Botswana is defined by the creative industry talent.”

 

 

 

 

 

 

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Report links child poverty to disability

12th March 2024

Child poverty is a pressing issue that affects millions of children around the world, and the link between child poverty and disability is a particularly concerning aspect of this problem. The recent research paper published by the Botswana Institute for Development Policy Analysis (BIDPA) sheds light on the stark reality that children with disabilities are more likely to be living in poverty compared to their non-disabled peers.

The findings of the research paper reveal that children with disabilities face higher levels of deprivation in basic capabilities such as education and health. This means that they are often excluded from essential services and opportunities that are necessary for their well-being and development. The wider gap in education outcomes between children with disabilities and their non-disabled peers highlights the systemic barriers that prevent children with disabilities from accessing quality education.

Moreover, the higher rates of deprivation in health and food security among children with disabilities further exacerbate their vulnerability to illness and malnutrition. This not only impacts their physical well-being but also hinders their overall development and potential. The research paper also highlights the economic disparities faced by children with disabilities, indicating that they are more likely to experience poverty across demographic and economic variables.

The implications of these findings are profound and call for urgent action to address the inequalities faced by children with disabilities. Affirmative action is needed to ensure that policies and interventions are specifically targeted towards addressing the unique needs of children with disabilities. It is crucial to prioritize the inclusion and empowerment of children with disabilities in all aspects of society to ensure that they have equal opportunities to thrive and succeed.

In conclusion, the link between child poverty and disability is a critical issue that requires immediate attention and action. It is essential for policymakers, stakeholders, and communities to come together to create a more inclusive and equitable society where all children, regardless of their abilities, have the opportunity to reach their full potential. By addressing the root causes of poverty and discrimination faced by children with disabilities, we can work towards building a more just and compassionate world for all.

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Botswana’s internet rated the second fastest in Africa

8th March 2024

Botswana continues to make significant strides in its digital trasnformation aspirations, as it secures its position among the top-ranking African countries for mobile internet speed. Based on statistics from the Speedtest Global Index, Botswana has been rated the second fastest mobile internet speed in the continent, with an impressive 43.79Mbps, according to a recent study by Business Insider Africa.

This accomplishment demonstrates Botswana’s dedication to improving the quality of broadband internet in the country; and re-affirms its position as a leader in Africa’s telecommunications and ICT services. “The acknowledgment of Botswana’s internet as the 2nd fastest in Africa reflects our commitment to cultivating a digitally inclusive society,” remarked Mr. Keabetswe Segole, Acting CEO of Botswana Fibre Networks (BoFiNet). “This achievement highlights our ongoing endeavors to enable all citizens to participate in the digital economy.” BoFiNet, the leading provider of telecommunications infrastructure in Botswana, has been instrumental in shaping the nation’s digital landscape.

Reflecting on BoFiNet’s contribution to Botswana’s digital connectivity, the Acting CEO stated:”BoFiNet takes pride in its role in securing Botswana’s position as the 2nd fastest country in Africa for mobile internet. Our robust fibre optic and microwave network has been pivotal in delivering high-speed connectivity to both urban and rural areas, ensuring access to reliable internet services for all citizens. We remain committed to fostering innovation and digital inclusion, thereby paving the way for a prosperous digital future in Botswana.” Through the recently launched SmartBots Village Connectivity project, 1,138 premises across 144 villages in different Botswana districts are able to connect to this fast internet.

Botswana’s population is utilising connectivity creatively as a result of a boom in mobile penetration, which is advancing the nation’s digitalisation. Rapid advancements in mobile high-speed internet are causing a digital revolution in Africa, bringing about changes in areas including the economy, education, healthcare, and empowerment.

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