July Parley to review mining laws
Brian Benza | Tuesday June 13, 2017 18:00
Addressing the 14th edition of the Botswana Resource Sector Conference in Gaborone yesterday, Mineral Resources, Green Technology and Energy Security minister, Sadique Kebonang said the laws under review include the Mines and Minerals Act, the Precious and Semi Stone Act as well as the Diamond Cutting Act.
“The amendments of these were done in order to set up mine closure funds for rehabilitation, pursue citizen economic empowerment initiatives, ensure safe use of explosives and prevent their use in criminal activities and increase penalties to deter illegal trade in the diamond sector,” he said.
The current Mines and Minerals Act only provides a framework that covers the environmental obligations, which include the requirement for the holder of a mining licence to carry out on-going rehabilitation of the site and to restore the land substantially to the original condition.
On citizen economic empowerment, government plans to give Batswana an opportunity to buy up to 26% in new mining ventures. Currently, government has an option to buy 15% shareholding in a new mining venture but the plan is to now raise the limit to 26%.
This was after it realised that the 15% does not carry much weight in terms of influencing the direction of a company. At 26%, the Companies Act will allow the government to exercise some minority rights in the mining company. But in the event that government opts not to buy the 26%, the plan is to pass on that option to Batswana to buy the shares.
Although the law currently allows government to buy a 15% shareholding in any new mining project with an option for a higher stake in diamond mines, government has of late foregone the option citing various reasons.
Some of the mining projects that government has passed on the option to buy a stake in recent years include the Lerala Mine, Boseto Mine, Karowe Mine, BK11 Mine, Ghaghoo Mine and of late the Khoemacau’s Qhoree Mine in Ngamiland. Some of the projects that are likely to materialise into new mines in the near future include First Quantum’s Sese Coal Mine, Jindal’s Mmamabula coal mine, Shumba Energy’s Mabesekwa and Sechaba Coal Mines and A-Cap’s Letlhakane Uranium mine.
Amongst some of the changes that will be brought in the minerals policy review include the development of cluster industries around mining projects as well as increased participation by citizens in supplies and procurement for mines. On the performance of the mining industry, Kebonang said 2017 had started on a good note with encouraging appetite demonstrated by diamantaires to buy rough diamonds.
The minister however said there is a rising concern that strong rough demand and prices were getting ahead of the polished and this had a potential to compromise the sustainability of the diamond manufacturing industry.