The government of Botswana and De Beers renewed its 36-year mining partnership Tuesday by signing a suite of agreements renewing the mining license for several mines, including the Jwaneng mine—considered to be the most valuable diamond mine in the world—as well as way for the country to share in the manufacturing and marketing of diamonds found within its borders.
The license for the Jwaneng mine will run for twenty five years (effective from Aug. 1, 2004). In addition, licenses for the Orapa, Lethlakane and Damtshaa mines have been extended to run until 2029, in line with the Jwaneng License.
The signing was held during a ceremony in Gaborone, the capital of the diamond-rich country, in the presence of Botswana’s president, F.G. Mogae, minister of Minerals, Energy, and Water Resources, Charles Tibone, and the chairman of De Beers, Nicky Oppenheimer.
The parties also signed an agreement covering the sale of Debswana’s production to the DTC for an additional five years.
They also agreed to establish Diamond Trading Company Botswana, a 50/50 partnership between De Beers and the government of Botswana, which will sort and value all Debswana’s diamond production. The DTC Botswana will carry out local sales and marketing activities, working closely with its customers to support the establishment of diamond manufacturing operations in Botswana, De Beers said in a statement. De Beers will fund the construction of a new DTC Botswana building that will house the partnership in Gaborone at a cost of more than $83 million.
“We share the mutual commitment to exploit minerals in Botswana in a sustainable, efficient, beneficial, and timely manner,” Tibone said during the signing ceremony. “These agreements will allow us to maximize economic benefit accruing to the country in a way that simultaneously allows the investor to earn a competitive return on their investment.”
“De Beers fully supports Botswana’s desire to establish a downstream diamond industry, and we are pleased to announce that diamonds will be made available locally for cutting and polishing factories in Botswana,” Gareth Penny, managing director of the De Beers Group, said in a statement.
De Beers also intends to bring diamonds from around the world to be “aggregated” by DTC International in Botswana, an activity that was previously carried out in London. This reflects the importance of Botswana as the world’s leading diamond producer and the role of government in creating the right environment for business in the country, De Beers said, adding that this new venture will support the country’s economy with new jobs, infrastructure improvements, and as a way to attract other business.
“It is exciting that this agreement not only extends the length of our partnership, but also its depth, as we move from mining diamonds together, to marketing them together,” Oppenheimer said following the signing ceremony.