Once profitable, Botswana Oil Limited will sell shares to the public, a development that will further broaden the participation of locals in the cutthroat industry.
The process will be done through government’ privatisation policy framework, founding Chief Executive told BG Business in an interview. “We believe that after three years or so, the company will offload part of its shares to the general public,” revealed Willie Makgatlhe, moments after the company was officially launched by President Ian Khama on Tuesday. Botswana Oil Limited is a 100 percent stated owned company.
It was formed to buy and distribute petroleum products on behalf of government. Botswana Oil will also manage government strategic oil reserves. It will be easy to list the company as far as legislation is concerned. “We are already registered as a company with board of directors. We are a limited company,” said the upbeat Makgatlhe who once led oil company Shell Botswana. As a limited company, they will not require a Transitional Act as it happened with other state parastatals earmarked for privatisation. The company’s total value or how much government has injected to kick-start it has not been made public. While he could not state with certainty the amount of shares they will put out for sale, Makgatlhe said it would be less than 50 percent. “But those shares will only be sold when we are profitable,” he stressed.
The shares will be floated on Botswana Stock Exchange (BSE), subject to listing rules. The listing of Botswana Oil Company will certainly happen after that of Botswana Telecommunications Corporation Limited and National Development Bank (NDB), both parastatals that have been approved for privatisation. BTCL is, expected to go public in a few months time. Meanwhile, speaking at the launch, Khama said the company would safeguard the security of supply of petroleum products. “It is therefore important to note that the entity will look at ways and means of bringing in petroleum products to ensure that we have reliable sustainable petroleum industry in Botswana,” he said. He pointed out that provision of adequate energy is a prerequisite for socio-economic and industrial development of any country.
The company has already hit the ground running. It has already signed Memorandum of Understandings (MoUs) with similar companies within the region. Botswana Oil Company has also cemented partnership with PetroSA, Petro Moc and NAMCOR owned by South Africa, Mozambique and Namibian governments respectively. More MoUs are expected in future, said Makgatlhe. Sources are saying Nigeria and Angola could be on the list of such partnerships.