Botswana: Diamonds Shine and Projects Loom

After a tough few years, Botswana seems set for fresh growth as new projects and infrastructure come on line.

By Eduardo Arcos

IMAGE: Vermeer

In 2016, the streets of Botswana were filled with blue, white and black flags, celebrating 50 years of the country’s independence. This southern African nation of just 2 million inhabitants has much to celebrate. Following its independence, the country was one of the poorest nations in the world, with virtually no developed infrastructure and economically dependent on a small beef industry. Since then, the country has undergone a dramatic transformation, becoming one of the most democratic and stable countries in the continent, as well as boasting one of the highest GDP per capita rates in Africa. In fact, from 1966 to 2014, Botswana’s GDP Continue reading

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Southern Africa Mining

Southern Africa has long profited from its mineral wealth, until recently. Mature mining destinations were the hardest hit by the collapse in commodity prices. At last the area is seeing some respite.

By Mungo Smith

IMAGE: Courtesy of Vermeer

The downturn in the prices of commodities has slowed down mining activity in Southern Africa over the last three years. Nonetheless, signs of recovery are evident. Immense mineral wealth, from diamonds in Botswana and Zimbabwe, to massive coal deposits in Mozambique and South Africa’s well-known gold reserves, continue to lure investors as commodity prices recover gradually and governments undertake efforts to boost mining activity. Continue reading

Joseph B. Mosimane, CEO, Ecsponent

MACIG Connect Series

Ecsponent is an investment company breaking into Botswana’s largely unexploited financial services market.

Can you provide an overview of Ecsponent’s exposure to the mining sector?

Given the nature of our business as an asset management company, we are approached by mining individuals. Just yesterday, we had somebody come to our door with a license but who did not have the means to develop his project. We do an assessment of their proposals to see if we can assist them. We are approached by individuals and companies alike. In the Palapye area, a company with a quarry approached us; they had a cash flow issue and they wanted us to assist them to put their operations back into full swing. Others even seek a partnership, particularly those at the smaller end of the spectrum who do not have large financial capabilities.

Are your clients mainly small and medium-sized players in the industry? Continue reading

Toby Frears, Managing Director, Okavango Diamond Company (ODC)

ODC sells the full range of Debswana’s production.

ODC is a relatively new company, wholly owned by the government of Botswana. Can you explain the impetus behind ODC’s creation and how it has evolved over the past few years?

Toby Frears (TF): ODC’S establishment was one of the outcomes of the new sales agreement signed between the government and De Beers in 2011 for the marketing of Debswana’s production. The company was formed as part of the government’s broader strategy for the development of Botswana’s diamond industry. Our mandate is to provide a sustainable alternative route to market for a portion of Botswana’s diamonds and to help transform Botswana into a leading rough sourcing destination. Continue reading

Paul Day, COO, Lucara Diamond Corp.

MACIG Connect Series

“The 1,111-ct stone is a historic discovery; one of our immediate challenges is to obtain maximum benefit out of this diamond for…Lucara, Botswana, and the industry as a whole.”

Lucara Diamonds commissioned the Karowe mine in 2012, and has since managed to bring the mine into full production and is now uprooting some of the world’s largest diamonds. What have been Lucara’s strategic steps towards the success of this asset?

Paul Day (PD): You are 100% correct Lucara mines and sells some of the largest diamonds in the world, and last week we recovered the largest gem quality diamond recovered for over a hundred years and the second largest gem quality diamond ever mined. This was an incredibly high quality 1,111-carat (ct) stone recovered from our Karowe Mine in Central Botswana. We are absolutely ecstatic and it is the culmination of a lot of hard work prepping ourselves to get to this position. Continue reading

Rodney Baker, General Manager, KPJ Drilling

MACIG Connect Series

“For now, KPJ Drilling is only looking to operate in Botswana and does not have any plans for expansion.”

KPJ Drilling is involved in 90% of the drill works in Botswana. What is the company’s strategy towards capturing the final 10%?

Rodney Baker (RB): KPJ Drilling does not really need a strategy to acquire the other 10% of the market. The company is based in Gaborone, as are most drillers in Botswana. The remaining 10% are located further from KPJ and are consequently serviced by other companies in the north. To acquire the final 10% would mean that KPJ Drilling needs to open another branch and compete with service providers in that area. We do not want competitors to come to Gaborone, and thus we will not compete in their territory.
Continue reading

Mashale Phumaphi, Managing Director, Shumba Energy

MACIG Connect Series

“This region is in a power crisis, and we need to utilize that as a catalyst for enhancing the physical links between countries in terms of transmission and IPP development.”

What have been Shumba Energy’s major milestones since GBR saw you last year?

Mashale Phumaphi (MP): In April of 2015, Shumba Energy acquired the new Mabesekwa coal project with approximately 860 million metric tons of thermal coal. It is a very large open-pit operation, about 18 meters thick, which we hope to develop specifically for the South Africa and Botswana energy markets. Shumba has partnered with an experienced power developer in the Mulilo Group, which has around 420 megawatts (MW) of independent power producer (IPP) generation in South Africa, primarily using wind and solar. Continue reading