De Beers Namibian Joint-Venture to Extend Life of Diamond Mines

Namdeb Diamond Corp., a joint-venture between the Namibian government and Anglo American Plc (AAL)’s De Beers unit, wants to prolong the life of its alluvial diamond mines along the southern coast of the African country.

The company may be able to mine at its Elizabeth Bay, Southern Coastal and Daberasup operations until 2035 after the government extended its mining license by 15 years beyond 2020, General Manager Riaan Burger said today in an interview in the Namibian capital, Windhoek.

“We can easily go up to end of license period if we get the cost structures right,” he said. “With optimization of new technology, we are confident we can do more.”

Namdeb’s land-based operations produced about 600,000 carats in 2013, while its marine mining unit extracted 1.16 million carats from the floor of the Atlantic Ocean. Namibia, which produces the world’s highest quality diamonds, is negotiating to sell some of the gems separately from an agreement it has with De Beers.

Namdeb said it’s losing output of 1,600 carats per day from a strike by more than 1,500 workers that started on Aug. 2. Workers want a 15 percent wage increase and additional education and medical benefits. They rejected Namdeb’s offer of a 10 percent pay increase.

“The union’s demands will increase cost levels and this will have a detrimental effect on long-term sustainability of our operations,” Namdeb’s Chief Executive Officer Inge Zaamwani-Kamwi told reporters today.

Marginal operations such as the company’s Elizabeth Bay mine, which resumed operations in 2012, are at particular risk, Burger said.

To contact the reporter on this story: Felix Njini in Windhoek at fnjini@bloomberg.net

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net Dylan Griffiths

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.