Debswana Diamond Company says with demand for diamonds expected to continue growing, the challenge remains how to continue supplying that demand with global production expected to plateau and then decline beyond 2020.
Debswana Managing Director (MD) Balisi Bonyongo is of the view that there continues to be a mismatch between the rate of growth of costs versus revenue. He added that mining costs continue to rise as the pits deepen, production costs continue to rise and the company’s plants get older.
“Only the most agile will survive and agility and flexibility, productivity and efficiency are the only way mining companies can survive in this environment,” said Bonyongo.
Speaking at the recent resource sector annual conference, he pointed out that global economic recovery has been sluggish since 2008 and it is unlikely that it’ll get back to pre crisis growth rates in the near future. He said that supply demand fundamentals in the long term matter and look favourable in the long term.
“We support De Beers’ strategy to sustainably maximise the value of each carat mined and to unlock the value of its leadership position across the diamond pipeline,” said Bonyongo.
He stated that in 2014, the first year under Horizon 1, was highly successful with Debswana making a step change in performance across all fronts of the business. Debswana MD believes that the company’s pursuit of zero harm has continued to be strong, with safety performance now comparable to the best in the world. He added that their Total Recordable Injury Frequency Rate (TRIFR) of 0.46 is the lowest ever in Debswana and is comparable with the best in the world.
The company’s diamond production has remained flat at 22 ÔÇô 24 million carats, in line with market demand and Bonyongo pointed out that productivities and efficiencies have improved in line with the operational strategy and they have built a business that is said to be robust, agile and flexible.
“In the next five years Debswana envisages to undertake major diamond production projects at Jwaneng and Orapa to unlock the full potential under Horizon 2,” Bonyongo stated.
Debswana MD further revealed that studies for the extension and expansion of Jwaneng Mine beyond Cut 8 and Orapa Mine beyond Cut 2 have commenced. He said tailings processing plants offer great flexibility options at reduced processing costs through employing improved technology to recover previously unrecovered diamonds in tailings resources.
“Our safety performance has continued to be exceptional and we take seriously our responsibility to manage and minimise the impact of our operations on the environment,” said Bonyongo.
He is of the view that Botswana has been endowed with some of the best diamond assets in the world, adding that as Debswana they are privileged to have been entrusted with the responsibility to mine some of these resources. He said the company is the largest producer of rough diamonds in the world by value, and diamonds continue to play a significant role in Botswana’s economy.