Continuing to put in place the foundations for future growth by developing new projects, De Beers interim results for the six months which ended on June 30, has shown that the company has developed four major new mining projects during the first half of 2007.
Managing Director for De Beers London, Gareth Penny, pointed out that in Canada, construction of the Snap Lake mine in NWT is nearing completion. “The construction is forecast to commence at the end of the third quarter of 2007,” he said. At Victor, in Ontario, he said that a successful winter road campaign has delivered required materials, equipment and fuel to the site. He stated that the construction is on target for an accelerated start-up date at the end of the second quarter of 2008.
Following the award of the mining license for the Voorspoed mine in South Africa, in the third quarter of 2006, Penny stated that construction, which commenced at the end of last year, is progressing satisfactorily. The project construction phase is scheduled for completion by June 2008, and we anticipate full commissioning at the end of June 2009.
De Beers’ newest marine diamond mining vessel, Peace in Africa, which commenced operations off the west coast of South Africa during June, is expected to yield approximately 4.5 million carats over its estimated operating life of 30 years, once it reaches full production.
Moving on to group production, Penny revealed that production has increased by 2 percent to 25.3 million carats from 24.7 million carats in the corresponding period last year.
“All mining companies showed growth in 2006,” he said.
To ensure a fit with the company’s long-term strategic goals, De Beers reviewed all of its assets. In addition to the sale of Gope Exploration Company in Botswana, Penny said De Beers is actively pursuing opportunities for the following mines: Cullinan, Kimberly Underground and Tailings, Namaqualand and Koffiefontein.
For Cullinan, he said they have received a number of binding offers from bidders and these are in the process of being evaluated.
“Both transactions for Kimberly Underground and Tailings are proceeding in accordance with the original timetable, and it is anticipated that these will be concluded in 2007,” he said. With Namaqualand, he pointed out the proposed merger for the West Coast operations of Alexkor and DBCM’s Namaqualand Mines into a new stand-alone diamond mining company announced in February. He said they expect discussions on the consolidation of the West Coast properties to begin now.
“The sales to Petra Diamonds for Koffiefontein mine was finished in July 2007,” he added.
According to Penny, De Beers is fully committed to implementing agreements with Government partners which will lead to greater beneficiation of diamonds in producer countries. Following their commitments to the government of Botswana regarding the establishment of DTC Botswana (DTCB), he stated that his company anticipates completing construction of the new, state-of-art DTCB building towards the end of this year.
“DTCB will be fully operational by early 2008, with the goal of achieving sales of US$550 million per annum for local manufacturing in Botswana by the end of the decade,” he stated.