DEBSWANA has migrated from being a 29 million to a 33 million carat company, and is now believed to be a 3 billion pula worth company, thus setting the year 2008 apart from the rest of the company’s financial years. This followed the presentation of the Company’s annual review at its head office in Gaborone recently.
Speaking to The Sunday Standard, in an interview shortly after presenting the report, Debswana Managing Director, Blackie Marole, said, “The outlook for 2008 looks a lot better.” However, it will not be without challenges.
Marole indicated that although the year 2007 was another high scoring year for Debswana, and that they were able to meet their target with an impressive overall diamond production of 33.4 million carats, the company’s performance was slightly lower than in 2006.
The less than satisfactory performance in that year, according to Marole, is attributable to two factors.
“First, it was due to market circumstances with the result that the sales were low, and the other factor accounting for that downside was low production because of variation in the distribution in the mining area.”
Against this background, the Debswana M.D says that they have adopted a proactive approach of projecting into the future with confidence by way of a three tier strategy, which consists of what the Debswana Chief termed three horizons.
The first part of this strategy manifests in optimizing revenue output and delivery from the existing assets, is projected to spread over a period of 5 years, and estimated to lapse in 2010. The next horizon consists in implementing a portfolio of projects and also securing the sustainability of the company.
“For instance, we are currently assessing options including determining if and when we should go underground, which naturally involves engaging the appropriate geo-technology to establish the feasibility of digging further,” Marole elaborated.
In addition, Marole said that his company is also looking at the old plants like Orapa no.1, with a view to establishing whether to keep the mine operating by upgrading it or replacing it. He expressed concern that expansion of the pit might affect the existing plant and, therefore, might have to replace part or the whole plant. In all these considerations and feasibility studies the company will certainly be spending lots of money.
Furthermore, Marole revealed that they have already started reprocessing and evaluating the mine dumps to determine whether it would be economic to mine them. This is contemplated within the second horizon.
It is envisaged that the third horizon of this 3 tier strategy will be about thinking in the long term beyond the current assets. In conclusion he said, “We have started the process of exploring other mines.”
Despite the challenge in cost terms, Marole maintained that the stars are shining for Debswana and that, given the contribution of diamonds to the economy, this should be cause for optimism for the country.