De Beers Group a 15 % Botswana Government owned leading diamond miner on Thursday 16th May announced the approval of a multimillion dollar new investment by its Namibia sea coast diamond mining operation.
According to the De Beers Parent company Anglo American, secondary listed on Botswana Stock Exchange, the investment forms a total capital cost of $468 million equivalent to almost P5 billion for the construction of a new custom built diamond recovery vessel at De Beers ‘s marine diamond recovery outfit Debmarine Namibia. The latter is a 50:50 joint venture between De Beers Group and Government of the Republic of Namibia.
The new vessel will become the seventh in the Debmarine Namibia fleet and the world ‘s first ever built custom-built diamond recovery vessel and is expected to begin production in 2022 with capacity to add 500,000 carats of annual production, boosting Debmarine Namibia figures up by 35% from its current levels. The highly ancitciapated move, approved by Debmarine Namibia Board of Directors will represents the largest ever single investment in the marine diamond industry with $234 million (over P2.4 billion) attributable to Anglo American through De Beers.
In a statement released on Thursday, Mark Cutifani, Chief Executive Officer of Anglo American, De Beers parent company says the addition of this custom-built vessel for the Debmarine Namibia joint venture will bring numerous benefits in terms of De Beers’ production profile by value and volume, the technologies that can be deployed from the outset to deliver greater efficiency and productivity, and sustained economic benefits for Namibia.
“This highly attractive investment offers a three-year payback, a more than 25% IRR and an EBITDA margin of more than 60% typical of the high quality of our brownfield growth options. We will continue allocating appropriate levels of capital in a disciplined manner across Anglo American’s wider organic pipeline of near and medium term growth opportunities, including the world class Quellaveco copper development in Peru, that we expect to contribute towards our 20-25% production growth by 2023.” He said
In a separate statement released by De Beers on the same day, the Group revealed that following an extensive global tendering process, leading marine mining experts Damen Shipyards were selected to build the ship base on their strong track record for delivering quality vessels and their advanced technological capabilities. De Beers says the new vessel will incorporate the latest marine technologies that will drive improved safety performance while optimizing efficiency and utilization rates.
Chief Executive Officer of De Beers Group Bruce Cleaver shared that some of the highest quality diamonds in the world are found at sea off the Namibian coast. “With this investment we will be able to optimise new technology to find and recover diamonds more efficiently and meet growing consumer demand across the globe.” He said
Captured in the De Beers statement Tom Alweendo, Namibia Government Minister of Mines and Energy commented that the investment further positions Debmarine Namibia as a key player in the sea coast diamond mining industry. “It is through investments like this we can continue to develop Namibia’s economy. As the Government we will continue to do what we can to promote and encourage investment in the mining sector.” He said. The new vessel is expected to create more than 160 new jobs alongside Debmarine Namibia’s current workforce of 975 employees.
Debmarine Namibia conducts marine-based diamond recovery around 120 to 140m below sea level in the Atlantic Ocean of the Namibian coast. Operating a fleet of six motor vessels (mv), capable of retrieving, and exploring for diamond-bearing materials from the seabed and processing them to a diamond-rich concentrate. They are mv Debmar Atlantic, mv Debmar Pacific, mv! Gariep, mv Grand Banks and mv Mafuta.
The sixth fleet preceding this newly announced one is currently the world’s most highly advanced diamond exploration and sampling vessel, bearing the nomenclature mv SS Nujoma, named after Namibia's founding president Dr Sam Shafiishuna Nujoma ,Mv SS Nujoma has been built at a cost of N$2.3 billion (US$157 million) and started full operations in June 2017.
The 12,000 tonne diesel-electric vessel, which has led to the creation of 140 jobs, the vast majority filled by Namibians, is 113m long and can accommodate a crew of 80. In addition, two chartered vessels, mv Coral Sea and mv Explorer, are used by Debmarine Namibia for exploration and sampling with rehabilitation of the seabed and the marine environment occurring naturally over time.
Namibia has the richest known marine diamond deposits in the world, estimated at more than 80 million carats. They represent around 65 per cent of Namdeb Holdings' total diamond production and 90 per cent of its diamond resources. Marine diamond recovery now produces more in annual volumes than the country’s land-based diamond mining. Investment into new custom-built diamond recovery vessel is expected to further position Namibia marine diamond industry as one the most prolific and leading in the world.
The state of the art jewellery manufacturing plant that has been set up by international diamond and cutting company, KGK Diamonds Botswana will create over 100 jobs, of which 89 percent will be localized.
Local diamond and metal exploration company Tsodilo Resources Limited has negotiated a non-brokered private placement of 2,200, 914 units of the company at a price per unit of 0.20 US Dollars, which will provide gross proceeds to the company in the amount of C$440, 188. 20.
According to a statement from the group, proceeds from the private placement will be used for the betterment of the Xaudum iron formation project in Botswana and general corporate purposes.
The statement says every unit of the company will consist of a common share in the capital of the company and one Common Share purchase warrant of the company.
Each warrant will enable a holder to make a single purchase for the period of 24 months at an amount of $0.20. As per regularity requirements, the group indicates that the common shares and warrants will be subject to a four month plus a day hold period from date of closure.
Tsodilo is exempt from the formal valuation and minority shareholder approval requirements. This is for the reason that the fair market value of the private placement, insofar as it involves the director, is not more than 25% of the company’s market capitalization.
Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Bosoto Limited and Gcwihaba Resources projects in Botswana. The company has a 100% stake in Bosoto which holds the BK16 kimberlite project in the Orapa Kimberlite Field (OKF) in Botswana.
African heads of state and global CEOs at the World Economic Forum Annual Meeting backed the launch of the first of its kind report on how public-private partnerships can support the implementation of the African Continental Free Trade Area (AfCFTA).
AfCFTA: A New Era for Global Business and Investment in Africa outlines high-potential sectors, initiatives to support business and investment, operational tools to facilitate the AfCFTA, and illustrative examples from successful businesses in Africa to guide businesses in entering and expanding in this area.
The report aims to provide a pathway for global businesses and investors to understand the biggest trends, opportunities and strategies to successfully invest and achieve high returns in Africa, developing local, sub-regional and continental value chains and accelerating industrialization, all of which go hand in hand with the success of the AfCFTA.
The AfCFTA is the largest free trade area in the world, by area and number of participating countries. Once fully implemented, it will be the fifth-largest economy in the world, with the potential to have a combined GDP of more than $3.4 trillion. Conceived in 2018, it now has 54 national economies in Africa, could attract billions in foreign investment, and boost overseas exports by a third, double intra-continental trade, raise incomes by 8% and lift 50 million people out of poverty.
To ease the pain of transition to its new single market, Africa has learned from trade liberalization in North America and Europe. “Our wide range of partners and experience can help anticipate and mitigate potential disruptions in business and production dynamics,” said Børge Brende, President, and World Economic Forum. “The Forum’s initiatives will help to ease physical, capital and digital flows in Africa through stakeholder collaboration, private-public collaboration and information-sharing.”
Given the continent’s historically low foreign direct investment relative to other regions, the report highlights the sense of excitement as the AfCFTA lowers or removes barriers to trade and competitiveness. “The promising gains from an integrated African market should be a signal to investors around the world that the continent is ripe for business creation, integration and expansion,” said Chido Munyati, Head of Regional Agenda, Africa, World Economic Forum.
The report focuses on four key sectors that have a combined worth of $130 billion and represent high-potential opportunities for companies looking to invest in Africa: automotive; agriculture and agroprocessing; pharmaceuticals; and transport and logistics.
“Macro trends in the four key sectors and across Africa’s growth potential reveal tremendous opportunities for business expansion as population, income and connectivity are on the rise,” said Wamkele Mene, Secretary-General, AfCFTA Secretariat.
“These projections reveal an unprecedented opportunity for local and global businesses to invest in African countries and play a vital role in the development of crucial local and regional value chains on the continent,” said Landry Signé, Executive Director and Professor, Thunderbird School of Global Management and Co-Chair, World Economic Forum Regional Action Group for Africa.
The Forum is actively working towards implementing trade and investment tools through initiatives, such as Friends of the Africa Continental Free Trade Area, to align with the negotiation process of the AfCFTA. It identifies areas where public-private collaboration can help reduce barriers and facilitate investment from international firms.
About the World Economic Forum Annual Meeting 2023
The World Economic Forum Annual Meeting 2023 convenes the world’s foremost leaders under the theme, Cooperation in a Fragmented World. It calls on world leaders to address immediate economic, energy and food crises while laying the groundwork for a more sustainable, resilient world. For further information,