The deal contains provisions that, until recently, would be considered significant concessions from De Beers
De Beers has signed a 10-year agreement to market Namibia’s diamonds—the longest agreement the two parties have ever signed.
As with most recent diamond agreements, the just-inked deal contains provisions that, until recently, would be considered significant concessions from De Beers.
– The agreement significantly increases the stones available for beneficiation: It calls for $430 million in rough to be sold each year to customers of the Namibia Diamond Trading Company (NDTC). NDTC is, like the country’s diamond miner Namdeb Holdings, a 50-50 joint venture between De Beers and Namibia.
– All “special stones”—defined as large or unusual rough—will be sold in Namibia.
– Fifteen percent of Namdeb’s run-of-mine production will be sold to a government-owned sales company called Namib Desert Diamonds.
“For us in De Beers, being partners with [the government of Namibia] is an aspect of immense pride,” said De Beers CEO Philippe Mellier at a signing ceremony for the deal. “We are proud to be partners with one of the most politically stable and aspiring countries on the African continent. [We] often talk that perhaps the tax on diamond mining is a little on the high side. But we always take comfort in the knowledge that every tax and royalty dollar that is paid in Namibia is used toward uplifting this beautiful country. Look around Namibia, and what one sees is a government that is working.”