* About P1.9 billion already spent * Liquidator made revenue amounting to over P686m as at end-August 2022
The longer the BCL liquidation process takes to complete, the more the taxpayer’s purse will continue to bleed with no guarantee that the billions spent as advance payment to the liquidator will ever be recovered. So far government has provided funding of over P1.62 billion composed of an advance P1, 698, 782, 027 to the BCL Liquidator since 24 November 2016, and the sum of P163, 358, 385 as terminal benefits to ex-BCL employees, bringing the total amount disbursed from the Consolidated Fund towards liquidation activities to P1, 862, 140, 412.
What should worry the taxpayers most, is that even the hopeful buyer of the BCL mine’s profitable asset, PNR Botswana, is also frustrated by the slow process despite having shown their commitment. They often find themselves caught in between as the liquidator allegedly either hikes prices of the spare parts they need, as well as the houses.
There are also allegations of the Liquidator selling some of the much-needed equipment and tools of trade to their employees instead of the PNR. Another issue of concern is that laws have been disregarded as the Liquidator of the mine is operating without 6.1 officer - who is a qualified mine engineer prescribed to lead such an operation under the Mines Minerals Act and Mines Quarries and Machinery Act.
The matter once again reached parliament through a question asked by the Member of Parliament for Selibe Phikwe West and Leader of the Opposition, Ditlhapelo Keorapetse.
The answer to the question created a heated debate in the House as more supplementary questions poured in from both sides of the aisle with legislators seeking more clarity.
One of the questions asked was why the liquidator is appearing to be overlooking Batswana when selling items like laboratories and workshops as there are many qualified Batswana who can provide services to the mine.
Minerals and Energy Minister Lefhoko Moagi responded that all offers are first made to citizens and that there are a number of Batswana owned companies who have shown interests through meetings with the liquidator.
"As we know those who have been staying in BCL houses will be considered first after the evaluation process which is to be completed either this month or January 2023.
“If they cannot afford preference will be given to different government departments such as BDF, Police, Health, Education or any other that will show interest before the general."
Moagi said funding from government was used mainly for Care and Maintenance expenses, insurance, VAT payments, labour costs, technical costs, Botswana Power Corporation debt, Water Utilities Corporation debt, hospital running costs, housing maintenance and expenditure and professional and technical services consultancy fees.
He said that the first Liquidation and Distribution Account (“L&D Account”) was lodged with the Master on 09 December 2022. The L&D account includes a record of all disbursements (payments) and realisations (income) since the date of liquidation up to 31 August 2022.
He said the liquidation is being undertaken under the supervision of the Chief Registrar and Master of the High Court and in terms of the Companies Act. In terms of this process, there is no provision for an audit, as the laws of Botswana do not make provision for the audit of a company in liquidation by either the Auditor General or an Auditor.
Although it is the desire that the liquidation process should not take longer than it already has, it is anticipated that all things remaining constant, the winding up of BCL Limited (in liquidation) and Tati Nickel Mining Company (Proprietary) Limited (in liquidation), as well as the sale of assets thereof, shall be completed by Q2 of 2024.
"We made announcements earlier this year to the effect that the Liquidators had entered into transactions with the Premium Nickel Resources entities for the sale of the Selebi Mines (Selebi and Selebi North shafts) and Selkirk Mine in Tati.
These transactions have closed," he said. According to the minister, subsequent to this transaction, the remaining assets, which did not form part of the Selibe Mines, remain in the estate of BCL as does the portion of Tati assets, which did not form part of the Selkirk Mine. The Liquidator commenced a sale process to seek offers to dispose of the remaining assets of BCL and Tati.
This sale process commenced with advertisements in both the local and international press on 20 April 2022. The closing date for this process was 30 November 2022. Offers from potential buyers have been received and are being considered.
Moagi said in addition to the foregoing, the Liquidator has made revenue amounting to P686, 491, 099 as at the end of August 2022. The sum is made up of sale of aircraft and movable property such as vehicles, sale of
Selebi Mines to PNR, debtor collections, P125million, sale of copper-nickel matte, which raised over P100 million, payment of Care & Maintenance costs by PNR, P109million, Rental income, P92million, VAT Refunds,
P131million and other income from services rendered and goods sold.
He said in terms of the Asset Purchase Agreements for Selebi and the Selkirk Mines, the aggregate purchase price payable by Premium Nickel Resources is US$ 56,750,000. Payment of this amount is structured as follows US$ 1,750,000 was paid to the Liquidator on the date of financial close, while US$ 25,000,000 shall be paid on the date on which Premium Nickel applies to take its operations from care and maintenance to a producing
Mine; this is subject to the conclusion of a successful prospecting programme which is currently ongoing.
It is expected that the application for removal from Care & Maintenance in terms of the Mines and Minerals Act will be made within three years commencing 28 January 2022. Moagi said US$ 30,000,000 is payable on the date on which the Selebi Mine is commissioned to commence construction. Once the application is made for a mining licence then PNRB will commence construction of the mining complex. This is expected to take approximately three years from the date the mining licence is granted.
“At present, the transactions have reached financial close and the Selebi Mines and the Selkirk Mine are now in the ownership of Premium Nickel Resources," Moagi said, further explaining that in the event that Premium Nickel Resources chooses not to proceed to apply for a mining licence, the transaction will be at an end and the Selebi mining assets will be restored to BCL.
He said the former employees of the estate have been paid in terms of the law and no further payment is due. The Government paid a sum of P163,358,385 as terminal benefits to all ex-employees of BCL and took cession thereof.
This is a proved claim against BCL and not a retrenchment package. According to the Liquidator, a retrenchment package does not apply in this case, and the cost is prohibitive even if any humanitarian grounds were to be invoked.