Q: Kindly give us an overview of the coal mining industry in Botswana?
A: It is strongly our belief that coal can and must be a significant part of the diversification strategy for Botswana. Botswana coal reserves are estimated to be in excess of 200 billion tons and when regional and international shortages abound, it makes sense that the timing for Botswana to step up investments into coal must be a logical conclusion. Furthermore the international price of seaborne thermal coal is once again favourable, a further reason for the country to commit to the development of this commodity. Lastly, Botswana coal is of a high quality and economical to mine.
Q: There are views that the coal mining industry is underutilized in Botswana given the untapped reserves, would you agree with that, and please share your reasons
A: Botswana is blessed with large, high quality coal reserves, but unfortunately there are limited skills and the know how to effectively extract and market coal. This process of extraction is null and void, if the coal marketing skill and knowledge does not accompany the process. Minergy has a vast and proven skills base and deep knowledge on marketing and trading coal and these will converge well with the current coal scenario in the southern African region.
Q: Despite having large coal reserves underground, investments in the coal mining industry are not that significant, what do you think is the challenge?
A: We attribute the lack of investment to poor infrastructure and the delay with regards to government investment in infrastructure in the past; and shortage of skills and coal mining, marketing and trading expertise.
To this end, Minergy has committed to making a conscious contribution to training and ensuring the transfer skills to the people of Botswana. Minergy deeply understands and has firsthand experience of the dire need to create jobs and is committed to being a part, even if it is a small part, to trying to solve this problem.
Q: Botswana lacks the right infrastructure to support exportation of coal. What do you think needs to be done to address the challenge?
A: The coalfields of Botswana are in some instances closer to markets in South Africa than the South African coalfields themselves. Current infrastructure allows for limited exportation of coal to South Africa but not the international markets. Botswana needs to connect to the South African rail infrastructure, for which the commitment has been made by the Botswana Government. It is now a case of building the line.
Q: If the right investments are made in the coal mining industry, how do you think that could benefit the country?
A: There is no doubt that the benefit will be tremendous. The Richards Bay Coal Terminal (RBCT) has a capacity of 91 Metric Tons Per Annam (mtpa) and Transnet Freight Rail (TFR) has a capacity of 82 mpta. Only 75 mt was railed in 2017 due to coal shortages. In our estimation Botswana could have or should at least be able to export 7 mt and we estimate that this could results in the creation of thousands of jobs, revenue of over $US 525 million (Over P5.1 billion), royalties of over $US 12,6 million (Over P124 million) and taxes of over $US 14 million (Around P137 million).
Q: Does the industry get enough support from government?
A: In our experience support and commitment from government is certainly there. Government departments working in collaboration with others, to ensure and approve projects in the stipulated timelines.
