South African firms eyeing Botswana copper mine takeover
- September 6, 2023
- Posted by: Quatro Strategies
- Categories: Africa, Mining & Metals, Rare Earths & Commodities
Several South African mining companies, including Impala Platinum, Exxaro Resources, and Sibanye Stillwater, are considering bids to acquire Botswana’s Khoemacau copper mine, which hosts one of Africa’s largest copper deposits. Additionally, several Chinese investors have expressed interest in the mining operations. Copper demand is expected to rise significantly in the coming years due to its use in applications such as solar panels and electric vehicles, driving increased competition among miners for copper assets.
While copper prices have experienced some recent declines due to concerns about a global economic slowdown, the long-term prospects for the metal and strong competition for the asset are likely to make it challenging for bidders to secure a bargain.
Khoemacau is owned by Cupric Canyon LP, a US private equity firm with funds managed by Global Natural Resources Investments (GNRI) and Resource Capital Fund VII LP. The sale process is expected to take several months and conclude near the end of 2023. South32 and Sandfire Resources previously dropped out of the bidding process due to the mine’s high valuation.
Khoemacau is situated in the Kalahari Copper Belt, producing approximately 60,000 tons of copper and about 2 million ounces of silver per year. Potential future investments could increase production to around 130,000 tons of copper and 5 million ounces of silver per year. The owners of Khoemacau are open to either a partnership or an outright sale of the asset. The mine is valued at an estimated $1.5 billion to $2 billion.
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