De Beers Considering Mine Closures in Namibia

SourcingOct 26, 2017

De Beers Considering Mine Closures in Namibia

Namdeb noted that satellite diamond mining operations Elizabeth Bay and Daberas are “well beyond their original planned life of mine.”

Kimberlite, the igneous rock in which diamonds are found, from a De Beers mine. The company released its Q3 production figures this week, while Namdeb responded to media reports about possible mine closures in Namibia.

London--Namdeb, the partnership between De Beers and Namibia, issued a statement Wednesday indicating that it is weighing diamond mine closures in the country, as the next few years are expected to remain challenging due to “subdued” economic growth worldwide.

Namdeb released the statement after The Namibian Sun quoted a union official as saying that De Beers would close four land mining sites in Namibia by 2022: Elizabeth Bay (closing at the end of 2018), Daberas (end of 2019), Sendelingsdrift (2020) and Southern Coastal (2022).

Namdeb does a combination of land and off-shore mining. Earlier this year, it launched what it said was the world’s largest and most advanced diamond exploration vessel, the $157 million mv SS Nujoma.

In its statement issued Wednesday, Namdeb did not confirm any of the closures but noted that its satellite mining operations, Elizabeth Bay and Daberas Mines, are “well beyond their original planned life of mine.”

“We are constantly investigating new mining opportunities; however, it is equally important that we plan responsibly for the possible closure of operations that reach the end of their economic life span,” Namdeb said. “The closure of any operation is always a last resort, and we are doing everything to operate economically, which includes seeking alternative ways of creating value.”

Regarding Southern Coastal, which is Namdeb’s core mining asset, the company said it is working on a “robust” plan for the next five years, which includes a significant increase in production next year.

Namdeb’s statement was issued the day after De Beers’s parent company Anglo American plc reported that diamond production has increased so far this year amid stable trading conditions.

In the third quarter ended Sept. 30, De Beers’s production totaled 9.2 million carats, up 46 percent from Q3 2016. Year-to-date, the company has mined 25.3 million carats, up from 19.6 million carats at this point last year, a 29 percent increase.

The principal drivers behind the increase were Debswana, the mines in Botswana that De Beers operates in partnership with the government there, and the ramp-up of production at the Gahcho Kué mine in Canada, which opened in September 2016.

Gareth Mostyn
Also, on Wednesday De Beers announced that strategy chief Gareth Mostyn will leave the company in early 2018 after 10 years with De Beers and Anglo American.

Anglo hired Mostyn as head of corporate finance in 2008, and he moved over to De Beers in 2012 as chief financial officer. He
also joined De Beers’s executive committee and its board.

He was promoted to his current role as executive head of strategy and corporate affairs last year.

Mostyn is leaving De Beers to become the chief finance and operations officer for the Church of England.

The company has not named a replacement.
Michelle Graffis the editor-in-chief at National Jeweler, directing the publication’s coverage both online and in print.

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