Masama’s new mining contractor, Meropa Resources, a wholly citizen-owned mining contractor, is currently mobilising while mining operations restarted in February this year.
Minergy’s operations were temporarily stopped last March after a dispute with the previous mining contractor, Jarcon Opencast Mining, over payable arrears.
According to a profit cautionary released to Botswana Stock Exchange investors this week, Minergy directors said while the suspension occurred in the last quarter of the 2022–2023 financial year, it had a lasting impact on the company’s sales, extending into the interim period.
“This, together with depressed coal prices both offshore and inland and an increase in inland inventories attributable to logistical challenges in South Africa, conspired to a very challenging trading environment for the mine,” the officials said in the cautionary.
The officials expect Minergy to report a net loss before tax of up to P103 million for the six months ended December 2023 or up to 71% higher than the previous corresponding period. The coal firm is due to release its results during the week of March 18.
Minergy’s performance for the interim period will also be hit by the lack of production between October and December last year, as Masama Mine changed contractors from Jarcon to Meropa. Sales during that period were derived from existing product inventory, officials said.
Minergy’s optimism for 2024 comes from the turnaround strategy guided by the main funder, the Minerals Development Company Botswana (MDCB), which injected P90 million into the mine in August last year.
The second phase of the strategic turnaround involved additional funding of P299 million from MDCB, which was made in December last year.
“Meropa mobilised to the site from 3 January 2024, allowing Minergy to resume mining activities in February 2024,” officials stated. “Full-scale mobilisation is expected by the end of February 2024 and full-scale production and sales by the end of June 2024. “This second strategic turnaround phase gives way to the follow-on phase of operational stabilisation and continuous business improvement as a low-cost quartile producer.” Minergy expects to maintain 364 direct and indirect employees this year, including 185 personnel from the mining contractor.
