Despite the fact that most of its assets in Africa have now been operating for decades and can be considered ‘mature’, the De Beers Group is working hard – and successfully – to extend the life of existing operations and continues to regard Africa as an excellent destination for both exploration and mine development. This is the view of De Beers Group CEO Bruce Cleaver, who recently answered a series of questions put to him by Modern Mining relating to the Group’s African operations.
The Venetia open pit viewed from the Eastern Pit viewpoint with the headgears of the Venetia Underground Project (VUP) on the skyline.
MM How does De Beers see its future in South Africa? Is Venetia going to be the Group’s only mine in the country or is there a real desire to find and develop new deposits?
BC De Beers Group continues to view exploration in South Africa as an important area of focus, and applying new technology to the approved areas while using the company’s historical data maximises the chances of success. While we are optimistic about the future of exploration in South Africa, diamonds do not give themselves up easily and it’s important to bear in mind that it’s rare for an economically viable deposit to be discovered.
However, the Department of Mineral Resources (DMR) has recently approved 32 of the 54 prospecting rights applications by De Beers Consolidated Mines, some outstanding since 2014. De Beers Group continues to engage with the DMR and views the latest positive developments as a first and exciting step in getting back to greenfields exploration.
We also continue investment in our existing mine Venetia. While it remains our only mine in the country at the moment contributing about 70 % of South Africa’s production, it is one of the world’s very few Tier 1 assets, and the largest diamond mine in South Africa. The US$2 billion investment is taking the mine underground – one of the largest investment projects underway in the entire industry – and this will see production continue into the 2040s.
MM Why has De Beers chosen to relinquish world-class operations such as Cullinan (which still has a huge resource) and Finsch when it is becoming ever more difficult to find new deposits of any real size?
BC De Beers Group’s focus is on undertaking long-term sustainable commercial activities – those that deliver the optimal outcome both for our own business and for the countries and communities in which we operate.
When we reviewed our activities at Cullinan and Finsch, we took the decision that selling those mines was the right approach. This was because of the fit within our portfolio, as well as the view that another operator would have the potential to operate the mines in a way that could continue to deliver maximum benefit to South Africa and the local community. The decision also allowed us to fund the expansion of Venetia.
MM With respect to Botswana, have the Cut 9 project at Jwaneng and the Cut 3 project at Orapa been approved? Is there a possibility of an underground operation at Letlhakane?
BC As the two key assets in Botswana’s mining environment, Jwaneng and Orapa will continue to play the central role at Debswana in the years ahead and we are pleased with the progress of work relating to Cut 9 at Jwaneng and Cut 3 at Orapa, and will communicate more about these in due course. While it would not be economic to develop Letlhakane as an underground operation, we have successfully established a tailings processing plant at the mine that will deliver around 800 000 carats a year of production from Letlhakane.
MM Similarly, what is the outlook for Namdeb in Namibia? For how much longer do you see land-based mining continuing? Is the focus going to be increasingly on marine diamond mining given the depletion of on-shore resources?
BC Namdeb’s land-based operations represent one of the oldest actively mined diamond deposits in the world. Namdeb’s land operations have performed phenomenally well for many decades. However, it is now increasingly challenging to extract diamonds long-term from that on-shore resource. The leadership team at Namdeb has been doing a tremendous job in their work to prolong the life of mine at these deposits, and this will be an ongoing focus.
Offshore, Debmarine Namibia continues to perform strongly and marine mining continues to represent a greater share of Namibia’s production. Debmarine Namibia currently operates a fleet of five mining vessels together with the newest addition, the sampling and exploration vessel Mv SS Nujoma. The prospects for an additional vessel look very good and we look forward to sharing more details on this in due course.
MM De Beers has had only a token presence in Angola in recent years. Are you considering returning to the country? More generally, how does De Beers view Africa as a destination for exploration and mine development?
BC I was invited to meet with President Lourenço in Angola to discuss the country’s diamond sector last year and had positive discussions about the future of the country’s diamond sector. Angola is making many positive changes, and while there is nothing further to report at this stage, we look forward to continuing the positive dialogue.
De Beers Group has a long and proud history of working with partner governments in Africa in a responsible and sustainable manner, and we are proud to have been able to play a role in supporting our partners as they seek to develop their economies through diamonds. We see Africa as an excellent destination for exploration and mine development. Of course, any investor requires stability and predictability in the areas where they seek to invest, but we have had very positive experiences working with our partners and are proud to have been an organisation to have enjoyed mutual success with government partners in the continent.
MM De Beers has reportedly started a trial programme to work with small-scale miners in Sierra Leone. What is the exact nature of this initiative and how is it progressing?
BC GemFair, as the initiative is known, aims to establish a secure, transparent route to market for ethically-sourced artisanal and small-scale mined (ASM) diamonds using bespoke technology. The proposed solution combines dedicated software (an app) and hardware (diamond ‘toolkit’) that enables the digital tracking of ASM diamonds throughout the supply chain and addresses key challenges and risks relating to artisanal mining activity. Our approach also requires participants to commit to abiding by a set of audited standards that ensures mining is carried out in an ethical manner.
By providing artisanal and small-scale miners with access to De Beers’ industry-leading distribution channel, offering fair prices and working with NGOs to improve standards, we hope GemFair will improve livelihoods and working conditions for the sector, while fostering the sector’s development as a credible and trusted source of diamond supply. The pilot is running in Sierra Leone initially, where significant progress has already been made in formalising the artisanal mining sector, and we have already started to see positive progress with GemFair. These are still early days for the pilot, but we have been encouraged by what we have been able to achieve so far.
MM You are on record as saying that De Beers might have to look at developing smaller diamond deposits given the dearth of major new kimberlite discoveries. What would your response be to those who say that De Beers does not have the ‘mindset’ to successfully develop and run smaller operations?
BC Over the history of De Beers Group we have had successful experience of running a number of different types of assets, with different scale, different approaches to mining, different locations and different operational challenges. As the industry progresses, we continue to look at what best suits our own portfolio and how best we could maximise our commercial performance as well as our positive impact in producer countries.
While we currently have larger scale operations in our portfolio, we are an efficient and agile business with a range of capabilities and an innovative mindset, so I know that we have the right skills to be able to develop and run different types of deposits that we think are a good fit with our portfolio.
Photos courtesy of De Beers