BCL too broke to buy Norilsk stake

SHARE   |   Tuesday, 11 October 2016   |   By Phillimon Mmeso
BCL mine BCL mine

BCL Limited, which has been placed on temporary liquidation by its major shareholder - Botswana Government -, is yet to pay Norilsk Nickel P3.3 billion for the acquisition of Nkomati mine in South Africa and Tati Nickel mine in Francistown. Addressing members of the media on the closure of the BCL Mine and Tati Nickel in Gaborone on Tuesday, acting Board Chairperson of BCL Limited, Dr Khaulani Fichani said that when the minister of Minerals in South Africa approved for the share transfer in August this year, BCL was already broke and couldn’t transfer the P3 billion. “When the shareholding transfer was approved we were already owing Norilsk Nickel P3 billion and currently don’t have it,” he said.

In 2014 BCL and Norilsk Nickel entered into definitive transaction agreements to sell its 50% participation interest in the Nkomati Nickel and Chrome Mine, South Africa, and its 85% stake in Tati Nickel Mining Company, Botswana to BCL. BCL, which was advised by  AFI -  a financial advisory firm focusing on  project finance, mergers and acquisition, capital raising and corporate restructuring – was to pay Norilsk Nickel P3 billion in cash. He said currently all the powers regarding the acquisition of Nkomati have been transferred to Nigel Dixon Warren of KPMG who is the liquidator. The acquisition of both Nkomati and Tati Nickel Mine was part of BCL Limited POLARIS II whose aim was to diversify the company and make it a regional player with high quality mining assets, supported by a strong metallurgical complex.

The concentrates from both mines were to optimise production at BCL’s Smelter. Permanent Secretary in the Ministry of Minerals, Resources, Green Technology and Energy Security Kgomotso Abi said the ore from BCL is depleting and is of low quality. “Mining at BCL has been expensive and very soon BCL Limited will shift it mining operations to Tati Nickel Mine,” he said. He said that the liquidator has been given four months to wrap up business at BCL and will give government report in February and advise on whom they can partner with to run the mine. BCL currently has assets valued US $700 million.