Economy of Botswana - Mining

Mining

Two large mining companies, Debswana (formed by the government and South Africa's De Beers in equal partnership) and Bamangwato Concessions, Ltd. (BCL, also with substantial government equity participation) operate in the country.

Since the early 1980s, the country has been the world's largest producer of gem diamonds. Four large diamond mines have opened since independence. De Beers prospectors discovered diamonds in northern Botswana in the early 1970s. The first mine began production at Orapa in 1972, followed by the smaller mine at Letlhakane. What has become the single-richest diamond mine in the world opened in Jwaneng in 1982. In 2002, a fourth diamond mine, Damtshaa, began operations. Botswana produced a total over 30 million carats (6,000 kg) of diamonds (about 25% of worldwide production) from the three Debswana mines in 1999, and is the highest producer of diamonds by value in the world. The Orapa 2000 Expansion of the existing Orapa mine was opened in 2000. A fifth diamond mine and the first not operated by Debswana is scheduled to have begun operations in 2008 in Lerala.

Most (70%) of Botswana's electricity is imported from South Africa's Eskom. 80% of domestic production is concentrated in one plant, Morupule Power Station near Palapye, operated by the Botswana Power Corporation. Debswana operates the nearby Morupule Colliery to supply coal to it. In early 2008, the entire southern African region was hit hard by massive shortages in power, since the region works to share its power resources through the Southern African Power Pool, with most of the capacity coming from South Africa. Botswana has in turn put in place plans through governmental expansion of the Morupule power station, as well as encouraging private investment in the form of a 4,000 megawatt power station by the Canadian Greenfield company CIC Energy to become a net exporter of power to the regional pool.

BCL, which operates a copper-nickel mine at Selebi-Phikwe, has had a troubled financial history but remains an important employer. The soda ash operation at Sua Pan, opened in 1991 and supported by substantial government investment, has begun making a profit following significant restructuring.