De Beers in Long Term Deal
with Botswana Government
·
The formal new agreements for a 10-year
Sales Agreement (which may be extended by a further 5 years) and a 25-year
extension of the Mining Licences (from 2029 through
to 2054) for the 50:50 Debswana mining joint venture.
·
Ongoing participation in the world's greatest
diamond resources for decades
·
A 25-year extension of the Debswana mining licences from August 2029 to
July 2054.
·
The Government of Botswana's rough diamond sales company, Okavango
Diamond Company ("ODC"), will sell 30% and De Beers will sell 70% of
Debswana's production for the first five years; for the subsequent five years
ODC will sell 40% and De Beers will sell 60% of Debswana's production; and both
parties will sell a 50% share for the five-year extension period.
·
Investment in a diamond jewellery manufacturing facility, establishment
of a De Beers Institute of Diamonds grading laboratory
·
Co-investment by the Government of Botswana and De Beers in marketing
initiatives to boost diamond demand. The marketing investments will be for
category and other marketing programmes, agreed annually, aimed at stimulating
rough diamond sales, protecting the ethical integrity of diamonds, and to
maintain and build consumer confidence in the product.
·
Botswana is the topmost producer of diamonds by
value.
·
Established in 1888, De Beers Group is the
world's leading diamond company with expertise in the exploration, mining,
marketing and retailing of diamonds.
·
De Beers Group employs more than 20,000 people
across the diamond pipeline and is the world's largest diamond producer by
value, with diamond mining operations in Botswana, Canada, Namibia and South
Africa.
·
Jewellery houses, De Beers Jewellers and Forevermark, and other pioneering solutions such as diamond
sourcing and traceability initiatives Tracr and GemFair.
· De Beers Group is a member of the Anglo American plc group.
HONG
KONG SAR - Media OutReach Newswire - 27 February 2025
- The Government of the Republic of Botswana (the "Government of
Botswana") and De Beers Group ("De Beers") announced that,
following the conclusion of negotiations announced on 3 February 2025, the two
partners have now signed the formal new agreements for
a 10-year Sales Agreement (which may be extended by a further 5 years) and a
25-year extension of the Mining Licences
(from 2029 through to 2054) for the 50:50 Debswana mining joint venture.
Honourable Bogolo
Joy Kenewendo, Minister of Minerals and Energy for
Botswana, said: "We are proud to announce the signing of this landmark new
agreement, which will underpin the success of our diamond industry as we enter
an exciting new phase of Botswana's sustainable economic development. We hope
that these agreements will bring some level of stability and rebuild market
confidence in the diamond industry. We are looking forward to our renewed
partnership with De Beers; together we will drive development through diamonds
and build a brighter future for Batswana."
Al Cook, Chief Executive Officer
of De Beers Group, said: "These are groundbreaking
agreements. The half-century partnership between the Government of Botswana and
De Beers is considered the greatest public-private partnership in the world.
Now we are both extending and improving it. For De Beers, it is a privilege to
secure our ongoing participation in the world's
greatest diamond resources for decades to come. I am also extremely proud
that through the Diamonds for Development Fund, we can further transform
opportunities for the people of the world's leading diamond country."
In summary, the formal agreements
represent:
A 25-year extension of the Debswana
mining licences from August 2029 to July 2054. This will enable the Debswana joint
venture to deliver long-term value from its existing mining assets and mine
life extension projects beyond the current mining licence period. Mine life
extension projects include Jwaneng Cut-9, Jwaneng Underground and Orapa
Cut-3.
·
A renewed 10-year Sales Agreement for Debswana's rough diamond
production, with a further five-year extension period where certain criteria
are met. Under the renewed Sales Agreement, the
Government of Botswana's rough diamond sales company, Okavango Diamond Company
("ODC"), will sell 30% and De Beers will sell 70% of Debswana's
production for the first five years; for the subsequent five years ODC will
sell 40% and De Beers will sell 60% of Debswana's production; and both parties
will sell a 50% share for the five-year extension period. As part of this
arrangement, De Beers and ODC have also both committed to supply diamonds for
beneficiation in Botswana in line with their share of Debswana supply.
In addition, a transformational
package of commitments focused on supporting Botswana's economic development
objectives and advancement of the diamond industry has been agreed, including:
The creation of the Diamonds for Development Fund
to support economic growth, diversification and jobs in Botswana in line with
Botswana's Vision 2036 and National Development Plan. De Beers has committed to
an upfront investment of BWP 1 billion (c. $75 million) and further annual
contributions from its dividends from Debswana, based on Debswana's
performance.
·
A package of initiatives to be undertaken by De Beers designed to
enhance local beneficiation of diamonds and increase participation of the
people of Botswana in the diamond industry. These include investment in a diamond jewellery manufacturing facility,
establishment of a De Beers Institute of Diamonds grading laboratory and
starting up a diamond vocational training institute in collaboration with
industry partners.
·
Co-investment by the Government of Botswana and De Beers in marketing
initiatives to boost diamond demand. The marketing investments will be for
category and other marketing programmes, agreed annually, aimed at stimulating
rough diamond sales, protecting the ethical integrity of diamonds, and to
maintain and build consumer confidence in the product. De Beers and the Government of
Botswana have committed to co-invest over the life of the Sales Agreement and
in proportion to their relative shares of Debswana supply.
About Botswana
Botswana, a thriving democracy, is
located in Southern Africa. Botswana is the topmost
producer of diamonds by value. Botswana is renowned for the rule of law,
including respect for property rights. Heralded for its ease of doing business
in the mining sector, it is by no coincidence that it is a premier investment
destination for mining.
The Botswana government has placed
a strong emphasis on effective management of its diamond resources, recognizing
their pivotal role in the nation's economic development. By exercising careful
oversight and strategic partnerships, Botswana maximises revenue from diamond
sales, strengthening its position as a key player in the global diamond market
and ensuring that these valuable resources drive sustainable socio-economic
growth. With a focus on sustainable practices, the government is dedicated to
ensuring that the wealth generated from diamond mining contributes
significantly to the welfare of its citizens. Revenue from these sales is
strategically reinvested to foster growth, infrastructure development, and
social programmes, ultimately positioning Botswana as a stable and prosperous
socio-economic hub in the region. This commitment underscores the government's
vision of enhancing the livelihoods of its people while promoting overall
national prosperity, thereby solidifying Botswana's reputation as a forward-thinking
and resilient nation in the face of global economic challenges.
About De Beers Group
Established
in 1888, De Beers Group is the world's leading diamond company with expertise
in the exploration, mining, marketing and retailing of diamonds. Together
with its joint venture partners, De Beers Group employs
more than 20,000 people across the diamond pipeline and is the world's largest
diamond producer by value, with diamond mining operations in Botswana, Canada,
Namibia and South Africa. Innovation sits at the heart of De Beers Group's
strategy as it develops a portfolio of offers that span the diamond value
chain, including its jewellery houses, De Beers
Jewellers and Forevermark, and other pioneering solutions such as
diamond sourcing and traceability initiatives Tracr
and GemFair. De Beers Group also provides
leading services and technology to the diamond industry in the form of
education and laboratory services and a wide range of diamond sorting,
detection and classification technology services. De Beers Group is committed
to 'Building Forever,' a holistic and integrated
approach for creating a better future – where safety, human rights and ethical
integrity continue to be paramount; where communities thrive and the
environment is protected; and where there are equal opportunities for all. De Beers Group is a member of the Anglo American plc group. For further information,
visit www.debeersgroup.com.