Botswana Shuts State-Owned Copper, Nickel Producer BCL on LossesBloomberg News
African nation couldn’t keep subsidizing BCL: Minister
Liquidator to be appointed by Monday, no jobs cut yet
Botswana shut down money-losing copper and nickel producer BCL Ltd. and began steps to liquidate the state-owned company, Mineral Resources Minister Sadique Kebonang said Saturday.
The governing cabinet decided the southern African nation couldn’t afford the 8 billion pula ($754 million) needed to keep BCL running, said Kebonang, who is also minster of green technology and energy security. A provisional liquidator is to be appointed by Monday, and none of BCL’s more than 5,000 employees have lost their jobs yet, he said in a phone interview.
“For the past 20 years, BCL Mine has not been doing well except for a short period when commodity prices were high,” Kebonang said, referring to the company’s operating unit. “To keep it going, the cost is 8 billion pula, and if you sink that into BCL, you have to shut down the entire economy, meaning no provision of free Anti-retroviral drugs or free education.”
Botswana, the world’s biggest diamond producer, had planned to sell its stake in BCL once the business returned to profitability, the government said in May. The price of copper, used to make cables, has edged 1.3 percent higher in 2016, after tumbling for three consecutive years. Nickel has rallied 16 percent following the biggest annual decline since 2008 last year.
“We are mining at U.S. eight dollars per tonne and selling at four dollars, and that’s a huge loss,” Kebonang said.
BCL, established in 1956, operates Botswana’s oldest mine and consumes about 20 percent of the country’s electricity. It’s fully owned by the government.
— With assistance by Bruce Stanley