Botswana mandates 24% local stake in new mining concessions

Botswana has introduced a new regulation requiring mining companies to sell a 24% stake in new concessions to local investors if the government chooses not to buy them.

The rule, announced by the Ministry of Minerals and Energy, reportedly took effect on October 1 Reuters.

Previously, the Mines and Minerals Act allowed the government to take a 15% stake in mining concessions, with the option of a higher stake in diamond projects.

The southern African nation, one of the world’s largest diamond producers by value and a rising copper mining hub, aims to increase local ownership of its mineral wealth.

This legislation is designed to encourage local value-added initiatives and requires mining companies to establish dedicated environmental rehabilitation funds.

During parliamentary debates on amending the Mines and Minerals Act, the former Mines Minister suggested that local investors could acquire stakes in concessions with the support of local pension funds.

Last year, a law change required these funds to reduce foreign investments from 65% to 50% over a period of three years.

The government, through the state-owned Botswana Minerals Development Corporation, holds stakes in the Moroboli coal mine (100%), Debswana Diamond Company (50%), De Beers (15%), and indirectly in the mining company via convertible debt.

last month, Bloomberg I mentioned that Botswana sought a deal to acquire a majority stake in De Beers by the end of October as negotiations continue with Anglo American, the diamond mining company’s controlling shareholder, and other interested buyers.

The Botswana government, which already owns 15% of the diamond company’s shares, aims to increase this stake to more than 50%.

Botswana President Duma Boko then stated that talks were ongoing with partners, including Oman’s sovereign wealth fund, to finance the acquisition.

“Botswana to award 24% local stake in new mining concessions” was created and published. Mining technologywhich is a trademark of GlobalData.

The information on this website has been included in good faith for general informational purposes only. It is not intended to constitute advice on which you should rely, and we make no representation or warranty, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.