The Minister of Minerals, Energy Security and Green Technology Sadique Kebonang says the Emirates Investment House (EIH) this week extended their due diligence on BCL assets to Nkomati Mine, after getting the green light from Russia’s Norilsk Nickel.
The 50% stake in Nkomati is under a legal dispute between BCL and Norilsk Nickel, with the Russians claiming they are owed $271 million by the BCL Group since a 2014 deal for the stake was now unconditional and binding. BCL and the Botswana government, however, insist the deal was not unconditional and they are not obliged to pay for the Nkomati stake.
In an interview with Mmegi Business this week, Minister Kebonang said a meeting was held between EIH and Norilsk over the weekend, where it was decided to extend the due diligence to the South African mine.
“The EIH wants Nkomati to be part of the deal. The due diligence on BCL assets is now complete and this week they have moved to conduct the same process at Nkomati. The expectation is for EIH to complete the Nkomati process by the end of the week,” Kebonang said.
If the government and EIH can strike a deal, it will likely lead to the legal action falling away, as Kebonang says the government is willing to pay off Norilsk if a buyer is secured.
“If a deal can be struck and the money is enough, then the proceeds will be used to settle with Norilsk Nickel,” he explained.
Norilsk has lodged several simultaneous legal proceedings against both the government and BCL over the disputed stake with the latest one announced last week where the Russians now want the government to be held directly liable for the botched deal. Responding to the lawsuit, Kebonang said the government was currently concentrating on finding a buyer for BCL and will defend the legal action as and when they need to.
“We are not having any sleepless nights over the legal action against the state. Our plan is to find a buyer for the BCL and if the funds from the sale are enough we will pay off Norilsk,” he said.
Russia’s Norilsk Nickel said on Friday it had filed a lawsuit against the government of Botswana to try and recoup $271 million plus damages it says it is owed from the aborted sale of a 50% stake in the Nkomati mine. Norilsk said in a statement it had served a notice of proceedings on the Attorney General of Botswana, the minister of mineral resources and the minister of finance. The mining company said funding for the deal will come from or be guaranteed by the government but the state had made no effort to complete the deal.
“The government has displayed a complete disregard for the fair, frank and reasonable dealing with outsiders which BCL’s insolvent circumstances demanded,” Norilsk Nickel Africa CEO Michael Marriott said in a statement.
In December 2016, Norilsk filed another lawsuit against the BCL Group, saying it had failed to honour its obligations under the sale agreement.
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