Local time: Tuesday, 25 February 2020 12:02:45hrs
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Ministry of Minerals, Energy and Water Resources (MMEWR)
Botswana Resource Sector Conference
Botswana Resource Sector Conference
Botswana Resource Sector Conference
Chairperson, Chief Executive Officers of different companies, Senior Government officials captains of the industry, the media, distinguished participants, ladies and gentlemen, Good morning. 1. I thank you all for travelling all the way from various parts of the world and the country to attend the Botswana Resource Sector Conference. Your participation of the conference is greatly appreciated and valued. 2. Today marks the twelfth anniversary of this Conference. The significance of this conference to the Botswana economy cannot be overemphasized as its presents an opportunity to exchange information and updates on minerals activities taking place both locally and globally. This conference comes at a time when the “minerals industry” is experiencing daunting challenges of weakened commodity prices and increasing environmental pressures. In Botswana the industry’s challenges are exacerbated by the prevailing power and water problems. 3. Government is fully aware of the challenges faced by the mineral industry, the weak demand in diamonds due to the mismatch in rough and polished prices resulting in factories scaling down and in some cases, closing down around the world due to squeezed margins in the diamond downstream sector. The base metals mines are also not spared from the poor commodity prices, government had to defer royalty payments for all but one base metal operations in the country to assist the companies in the short term to overcome their financial pressures. My Ministry will continue to assist the industry on a case by case basis and is open to suggestions from the industry which are mutually beneficial. 4. It would be remiss of me not to talk about the impact that power and water have on mineral investments. Mining by nature is energy intensive and thus the availability of energy and preferably inexpensive energy, is among the key factors of success in developing new mines. 5. I am also conscious that where there are energy challenges, as currently prevails in Botswana, the investment community attaches high risk to energy intensive investments. Mitigating such risk from the providers of funding entails high interest rates, if at all the funding can be made available. 6. It is in recognition of the crucial role that power and water play in driving investments, especially investments in the minerals sector, that we are channelling all our energies and resources into resolving the prevailing power and water challenges. 7. Much as this is a resource conference I feel I should take this opportunity to share our short term interventions to deal with the current power and water challenges as well as our plans in the long to term supply these key utilities sustainability. 8. Let me speak to energy first. The plan is to achieve electricity self-sufficiency by 2019. The national peak demand is projected to grow from 610 MW in 2014 to about 900MW by 2019, against a projected supply of 1200MW. The Government intends to address the immediate, short to medium term and long term power requirements in the following manner: a. As an immediate action 600MW Morupule B Power Plant boilers and associated infrastructure is undergoing short term remedial repair over the next 10 months to guarantee short term power availability after which all the four units are expected to be fully functional. This will be followed by major boiler and components repair and replacement work over the next two years to ensure reliability of the plant over the life cycle of the power station, that is over 30 years; b. BPC is increasing the diesel peaking plant capacity by 35MW, bringing the total peaking plant portfolio to 195MW by July 2015; c. a decision has been made to refurbish 4 X 33MW Morupule A Power Station, which is currently under care and maintenance, in a way that brings into service 3 X 33MW Units by winter of 2016 and the fourth unit by winter of 2017, and an option of building a new 150MW Unit by 2018; d. In the medium term there is a plan to develop a new 300MW brownfield and 300 MW greenfield Coal fired power plants through an IPP model. The Request for Proposals for the brownfield will be closed in July 2014, while the greenfield will follow immediately after completion of the adjudication of the brownfield RFP. The new power stations are expected to be brought into service in 2018 and 2020; e. the Government is very much alive to the need to preserve the environment. In this regard, expressions of interest was floated to procure short term and long term gas supply for the 2 X 45MW Open Cycle Gas Turbine Power Plant at Orapa. In addition, tenders will be called for the development of a large scale solar power plant, preferable in Jwaneng and Maun areas.
9. Chairperson, while the national development principles and planning objectives reflect the goals of economic growth & diversification, social equity, poverty eradication and environmental sustainable development, water is central to realizing these objectives. The development of the National Water and Wastewater Policy represents the Government’s commitment to ensuring that water supply meets water demand, including demand for the mining sector, in the short, medium and long term. In order to meet increasing water demand the Government continues to develop the necessary infrastructure such as pipelines and wellfields. 10. On that note, the Ministry is preparing for the detailed designs of the North – South Carrier 2 (NSC 2) Pipeline from Palapye to Mmamashia and Chobe – Zambezi Pipeline from Kazungula to Moralane near Serule. The latter pipeline will feed into the North – South Carrier Programme. The target is for this pipeline to supply water to Francistown, Tonota, Serule and other villages upstream of Francistown en-route to Moralane. Given the current of water shortages both pipelines will be fast tacked in order to deliver water to the eastern and southern part of the country sooner than originally planned. 11. The Water Policy clearly states that the water allocations supporting different sectors and industries must be integrated within the national management framework to ensure sustainability and maximize benefits in the national interests. In pursuing that, water uses associated with exploration, mining and industry are to be accounted for. The conservation measures and protection of the water resources need to be effected for optimization purposes. The Mining Industry is urged to promote the development and application of technologies aimed at reducing the water requirements for mining and industrial operations. As part of optimization, the water balances have to be fully accounted for and all water uses integrated as part of the water right allocation framework. 12. I would like to assure you that we are not lulled by our country’s previous successes, neither are we discouraged by the power, water challenges and the depressed commodity prices. The question that keeps me awake continues to be, is how to enable you to earn returns on your investments and at the same time optimize national benefits. I believe with committed strategic partners, such as you, we can join hands in the sustainable development of Botswana’s mineral resources for the benefit of both parties, and leave a mark that our future generations can be proud of. 13. With regards to the implementation of the Trans Kalahari Rail Project, a project management office for the implementation of the TKR project has been established. The Project Management Office (PMO) Agreement, whose scope is to regulate matters relating to or arising out of the establishment and functioning of the PMO and its relationship with the Governments, was signed on the 4 September 2014. The Namibian Government has completed renovations of the premises earmarked for PMO office. 14. Two officials from each of the two Governments have been sent to the office to make the necessary arrangements to operationalise the Office. Aurecon completed a consultancy services for the production of TKR development plan and the final report has been shared with the Namibian Government and the industry was briefed on this. 15. In striving to better Botswana’s competitiveness as a mining jurisdiction, the Ministry has setup a task team to develop a draft minerals policy document. It is envisaged that this team will complete the draft before the end of the Second Quarter of this year, which will be followed by internal Government consultation then public consultations. 16. The drafting of Mines and Minerals Act amendment Bill which was initiated in 2013 to take account of the mining of emerging minerals such as Coal Bed Methane (CBM), introduction of the mine rehabilitation financial instruments and strengthening of provisions dealing with illegal mining to be deterrent. The drafting of the Bill is being finalised with the Attorney General. 17. The two other pieces of legislation, which are in the process of amendment, and might be of interest to you, are the Diamond Cutting Act and the Precious and Semi-Precious Stones Act. The purpose of the amendment is to enhance regulation and foster local diamond beneficiation and trading. The Bills have been submitted for gazettement for the public to review and submit their input. 18. Let me conclude by thanking Capital Resources for organising the conference and the various sponsors for their contributions towards this conference. I wish you fruitful deliberations and a beautiful stay during the course of the conference. Pula Pula!!!
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