Operations at Khoemacau Copper Mine were officially inaugurated by President Mokweetsi Masisi on 30 July 2021 in Botswana’s northwestern village of Toteng. The copper development company is operating a safe, reliable, mechanised copper silver mine, unlocking value in the Kalahari Copperbelt.
On 28 June 2019, President Masisi officiated at a groundbreaking ceremony of Khoemacau Copper Mine. This marked the official launch of the mining project at the Zone 5 processing plant, 72km from the resort town of Maun in the North West District of Botswana. The mine has commenced production, with the first concentrate having been produced at the Boseto processing plant, safely and within schedule, in June. The total development metres since commencement of mining in February 2020 up to 19July 2021 is 15,874 metres. The first ore from the Central Corridor was on 14 August 2020 and the total ore produced as of 19 July 2021 is +429kt. The first concentrate production was on 30 June 2021 and shipped off site on 19 July 2021.
The mine has now reached the commercial stage of the project, despite challenges brought about by COVID-19. The project has the capacity to produce 155, 000 to 165, 000t of high grade copper and silver concentrate a year, containing about 60, 000t to 65, 000t of payable copper and 1.8 million to 2 million ounces of payable silver.
All the concentrate that the company produces is sold to an off-taker who then transports it to various destinations where there is capacity to extract the copper and silver and sell it on the commercial market. “The only thing you can do with concentrate is, first of all, taking it into a smelter,” Johan Ferreira, the CEO of the mining company, told journalists recently. “So, wherever there is a smelter, this is the actual opportunity to sell. There is no other beneficiation processes (except) through a smelter and they do have some metal that you can use.”
Botswana will miss out on that beneficiation process, highlighted by Ferreira. BCL in Selebi-Phikwe has one of the biggest and most sophisticated smelters in Africa. Mining engineers believe that Khoemacau could be BCL’s biggest client if it restarted operations. In the mining industry, there is continued discontent over an announcement by BCL liquidator, Trevor Glaum, in February this year that Premium Nickel Resource Corporation (PNR) was chosen as the preferred bidder for acquisition of BCL after the company closed the copper-nickel mine in October 2016.
“A restart of the existing smelter has not been considered as PNR intends to produce commercial concentrates,” said the company in its investor brief, causing more disquiet among a patriotic section of the country’s mining circles.
In a previous interview with former BCL MD Montwedi Mphathi, it emerged that PNR was of the view that restarting the smelter did not make business sense, given the large amounts of money needed to refurbish it and the huge financial commitment that the preferred bidder would have to make towards environmental rehabilitation of Selebi-Phikwe. Mphathi heads a team of investors in PNR who have emerged as the preferred bidders for BCL Limited. The Canadian company was exclusively selected from among two other bidders.
According to Mphathi, for the smelter to be operated sustainably, the life of BCL Limited would have to extend by between 20 and 40 years. “The information we have currently is that BCL lifespan can only go up to 15 years, which cannot justify re-starting the smelter,” Mphathi said. The BCL smelter was a contentious factor that delayed the mine’s sell-off, with suitors deterred by the P3 billion ($285.9m) that would be needed to set off its environmental liability. Mphathi added that the smelter pollutes the air in Selibe-Phikwe with its emissions. “Selibe-Phikwe cannot allow the pollution to continue,” he said. “Financiers like banks would not be comfortable financing such pollution in the era of environmental protection.”
Despite PNR deciding against restarting the smelter, it has been revealed that the BCL smelter is a key asset that would not only bring to life Botswana’s mineral beneficiation dreams but also extend the mine’s lifespan, create more jobs and add impetus to diversifying the country’s economy. The BCL smelter, which was estimated to be valued at around P3.5 billion, was also said to be BCL’s most valuable asset. It is understood however that the longer the smelter stays shut down, the more it will wear from desuetude.
With Khoemacau commencing operations, observers believe that a large smelting contract would have been secured by BCL, which would generate billions of Pula for BCL annually. The contract would have been a guaranteed one, given the fact that there is no other like the BCL smelter in Botswana and the rest of southern Africa.
While Mphathi argued against re-opening the smelter, it is believed that the faclitiy is a strategic asset in beneficiation of copper and nickel in the Southern African Development Community (SADC), according to information released by BCL Limited authorities just before its shutdown. Under the then ambitious strategy dubbed Polaris II, BCL previously said plans were in place to develop sulphuric acid using the smoke emissions from the smelter to diversify the mine. A Japanese company called Itochu was actually engaged to conduct a feasibility study that has established the cost of selling the sulphuric acid and even the markets available.
But Mphathi says the decision on sulphuric acid production was done a few years ago and that market dynamics may have changed and no longer favour such an undertaking. He points out that building a sulphuric acid plant would be an additional investment, which is risky. There are mining engineers who believe the new BCL owners can actually revisit that idea, more so that the BCL smelter was the largest money-spinner in the entire BCL operation. BCL made a lot of money with the smelter, which has the capacity to process over 900 000 tonnes of metals annually.
The mine had also planned to upgrade the smelter and continue to process some metals produced by various mining companies within Botswana and regionally, which BCL executives then said could be another money spinner for the mine. The plan included approaching mining companies regionally to process their metals at the BCL smelter, a business that can grow even beyond the BCL lifespan. For this reason, engineers close to the BCL bid strongly believe that any suitor who did not propose to restart the smelter should have been automatically disqualified.
“The environmental impact of the smelter can be mitigated,” said one engineer. “The benefits of restarting it far outweigh those of closing it because the smelter alone would extend the lifespan of BCL beyond mining, ensure economic diversification and bring to life Botswana’s mineral beneficiation ambitions.”