Debswana Diamond Company, the star performer in the De Beers Group of companies, said the Cut 8 plans are aimed at pushing up the life-span of the world’s richest diamond mine.
Geoff Jones of Debswana told Capital Securities Resource Sector this week that mining of Cut 8 that is aided by world’s best global mining research has leap-frogged the project and is aimed to be completed before the end of this year.
“We had a lot of benchmarking to do and we collected a lot of data from Australia, Chile, Canada and from all over the world,” he said.
Debswana is planning on embarking on Cut 8 in a bid to extend its mininjg life plan by a further 18 years.
The plan involved the Chilean contractors renowned for their extensive mining experience.
Jwaneng mine is the world’s most valuable resource and currently produces about 14 million carats per annum. The mine is also De Beers’ strategic investment as the company controls 40 percent of the world’s rough diamonds.
As part of the plan to make the mine more profitable, Debswana has farmed out some of the non-core activities, such as drilling, to contractors.
Jwaneng Mine is owned by Debswana, a 50/50 percent joint-venture between De Beers and Botswana government.
The two shareholders have injected close to P 24 billion towards the project that is expected to extend the life-span of the mine by seven years from 2017.
The move is part of a plan aimed at giving the shining star in the Debswana stable of mines a life-line by a further six years to 2024 making it one of the international legion in high value diamond production.
The project is expected to ensure profitable and continuous production at Jwaneng mine until around 2024.
With this, the mine will also ensure continuity of revenue from Debswana to the shareholders for years to come.
The rough diamond mining industry is the mainstay to Botswana government’s economy, contributing over 33 percent of the GDP and over 50 percent of the government revenue. The country has five operating diamond mines, four of them owned by Debswana while the last one is being run by Firestone Diamonds.
“Including all project stages from feasibility, design, implementation, mining operations as well as the cost of plant and equipment, the estimated project investment is P 24 billion in today’s money,” the company has said.
“This is the largest investment that Debswana shareholders will make since the discovery and the development of Jwaneng in1982,” it added.
The project will deliver a couple of things, most significantly continuity of production. This is important because it extends the life of the mine and uninterrupted flow of revenue into the coffers of Debswana shareholders.
Cut 8 is about creating next level of infrastructure on the Jwaneng mine to enable continued and uninterrupted production of the diamonds from Jwaneng mine.
Jwaneng Mine is the richest mine among the Debswana stable of mines and boosts of low production cost against its peers across the world. The cost per ton in Botswana is about US $ 8 while in other major diamond producing countries, such as Russia, it costs about US $ 45 per tonne.