MACIG Connect Series
“There are many minerals being exploited in [Botswana] with many more potential mines capable of coming to fruition in the not too distant future.”
Given the global downturn in commodity prices, what minerals are currently the most promising for Botswana’s mining sector?
Charles Siwawa (CS): Botswana has seen slower growth than was forecasted, but the Chamber is confident in the country’s determination and adaptability. The Discovery Metals Ltd. mine closed down this year, but was quickly acquired by Cupric Canyon, which we hope will be operational again within the next couple of years. It is forecast that diamonds, copper/nickel, and gold will bounce back quicker than other minerals. Even if mines are forced into minimalism for the next 12 months, we will see an immediate turn around once prices are in our favor. Diamonds have traditionally been the center of gravity for mining revenue, and the Kalahari copper belt has significant potential, but investors should also focus on Botswana’s second largest coal deposit in Africa, and the construction of the railway line will help develop that asset further. The periods of depressed commodity prices offers mining assets at reasonable prices, and the potential and opportunity in Botswana are undeniable. There are many minerals being exploited in the country with many more potential mines capable of coming to fruition in the not too distant future.
Has there been any mobilization in regards to construction of the Botswana-Namibia railway line?
CS: Botswana signed the bilateral agreement with Namibia to start the construction process that would link the coalfields with the port of Walvis Bay in March of 2014. Regrettably, the price of coal in the interim has derailed the project slightly. There is now a rethink in our strategy. Neither party has abandoned the project, as it is surely still viable, but we are now exploring the option of having the railway carry more than just coal. The Botswana government agrees that it is also appropriate to ease the finished goods import process. As a central part of the Southern Africa Development Community (SADC), Botswana needs more infrastructure to give and take from the rest of the world. Botswana has put across plans to consider extending the railway line into Zambia and the Democratic Republic of Congo. There are lots of input measures to consider when designing the railway route, and in our area of Africa the geological terrain is an obstacle in itself. There are areas that need to be avoided due to excessive sand that could adversely affect the railway’s operation and others that are too rocky and expensive to clear. Not to mention the environmental aspects, such as avoiding national parks. We need to be sure that we account for all elements, including ensuring ease of accessibility to current and potential mines.
Does the Chamber of Mines and its respective members feel supported by the government through the commodity price crisis?
CS: Our government has managed to lift Botswana from the bottom of the heap at independence in 1966 to a middle-income country by 1985, and we have continued to maintain that status. It is recognized that mining is important to the development of the country and hence all the reasonable, affordable support by the government is indeed welcome. Many companies are trimming their costs in any way possible that does not entail retrenching people. But in regards to Chamber or government support, there is no one-size-fits-all for avoiding a care and maintenance status, or worse, a shutdown. The Chamber and the government are both focused on attracting foreign direct investment as a means of stabilizing the industry through the trough of commodity prices cycle, but Botswana is already one of the most secure investment destinations in Africa.
The Chamber of Mines and the Ministry of Education has also been in partnership for the creation of the GIZ organization as a means to overcome the skilled labor shortage. What updates can you report on the success of this initiative thus far?
CS: Unemployment is a problem everywhere in the world, and we hope to alleviate that in Botswana via skills development and transfer, with our citizens acting as understudies for any foreign mining employee operating here. The Chamber provides the program with the expertise to instill skills into young Botswana miners, while the government provides the infrastructure to actually conduct the training. We have engaged some one hundred students into a four-year artisan development program that should see them coming out of that training with well suited qualifications for the mining industry.
Is the Chamber actively involved in any plans in regards to domestic beneficiation?
CS: The Ministry of Minerals, Energy and Water Resources has partnered with the Chamber of Mines to embark on a Base Metals Beneficiation Project. This project will assess the viability of processing base metals beyond what is currently being done in the country. The preliminary report detailing the concepts and first-level financial analysis should be produced by the end of the year. Botswana has set up beneficiation of raw diamonds through establishing cutting and polishing factories locally. We hope beneficiating our base metals will add value to our economy in a similar manner.
This interview was conducted as part of research by GBR for its upcoming Mining in Africa Country Investment Guide (MACIG) 2016. A pre-release report on the Central African Copperbelt was released in October 2015 and can be accessed here. To participate in this report, please contact Molly Concannon at firstname.lastname@example.org or +244 940 514 806.