Commodity price rise can ease BCL�s burden - Nganunu
Onalenna Kelebeile | Friday November 29, 2013 16:45
Speaking during a recent retirees awards ceremony, Nganunu said BCL has been plagued by a plethora of challenges from its beginning which have seen it struggling constantly.
From its inception the mine faced technical problems at the smelter and concentrator, which required enormous repairs and adjustments.
“These repairs and adjustments required the company to incur huge loans that further resulted in delays leading to loss of production and sales. The final results were a crippling debt for BCL,” he said.
He explained that the initial setbacks meant that what should have been a fine and profitable project for Botswana did not ultimately deliver as expected. “BCL project assumed financial burdens right from the beginning and even before the cost of actual mining. The project started to lose due to the repayment of additional loans and interest,” he stated.
Nganunu said that initially geologists discovered copper/nickel deposits with little cobalt. They felt that the deposits would have been financially profitable if it had contained more cobalt. “From the assessment that the deposits were viable, the company and government of Botswana strategised on how to mine the deposit and the provision of infrastructure at the site became a challenge,” he explained. Government then engaged international financial institutions to help raise necessary funding for infrastructure that included the construction of a new dam at Shashe River, a coal fired power station on site, a new road and railway connecting the deposits to the rest of the country and a new township with necessary amenities to maintain mine population.
“Raising of funds for these facilities and their construction to meet the schedule of the mine constituted a challenge especially for the new administration that did not have manpower to handle such a complicated project,” explained Nganunu.
“A series of very complicated agreements were negotiated and signed to bind all concerned to their obligations especially to ensure that the shareholders and the company would pay the financial obligations for loans supporting the infrastructure,” he added.
He said employees and management of BCL mine worked hard under difficult conditions for a long period of time. When things were tough, partners pulled out of the project and government remained as the constant financial supporter. “The 119 retirees we are celebrating today may have toiled and saw all that seeing that some have been with the mine for 40 years. They worked under difficult conditions to keep the company afloat,” he said.
Nganunu stated that for many years, there have been threats of mine closure because of depletion of ore. He added that BCL family developed a good employer/employee relationship so that any problems are discussed and resolved at union level
He advised retirees to take proper care of their retirement benefits.