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RAPAPORT... Gem Diamonds Limited opened the Ghaghoo diamond mine in Botswana, the first underground diamond mine in the country and the company's second major producing diamond mine -- the first of which is Letšeng in Lesotho. Gem Diamonds explained that a phased development plan at Ghaghoo defines the project as a "new generation" of diamond mining, with a core focus on ensuring that the highest benchmarks of excellence across health and safety and social and environmental impact are achieved. Ghaghoo's launch was not without controversy, however, given its location on the ancestral land of the Bushmen as reported yesterday on Rapaport News (read story).  The name Ghaghoo is derived from a locally abundant camel thorn acacia tree in the Central Kalahari Game Reserve and a name historically used by locals prior to geological exploration teams labeling the area Gope -- literally translated meaning nowhere. Gem Diamonds acquired the mine in May 2007 through its local subsidiary, Gem Diamonds Botswana, and it holds a 25 year mining license on the project. The Ghaghoo mine is situated in the southeast portion of the famed Central Kalahari Game Reserve. One of the most difficult tasks to overcome was mining through approximately 80 vertical meters of sand overburden before reaching the competent country rock, which created unique challenges for the project team. Despite these challenges, Gem Diamonds stated that good progress has been made on the development and it remains on target to deliver first phase objectives and begin commercial production before the end of the year. It is anticipated that Ghaghoo will ultimately tap 20.53 million carats with an in-situ value of $4.9 billion. The mining company explained that Ghaghoo first underwent extensive studies and assessments related to protecting the environment, local communities and broader social impacts of the region. Furthermore, operating underground significantly reduces environmental impact, according to the firm. Ghaghoo was built to high specifications to ensure that the environment was protected as far as possible, with comprehensive rehabilitation plans in place, the company stated. Additionally, Gem Diamonds stated that it had conducted in-depth community consultations as part of a broader social engagement strategy and it remained committed to ensuring the well being of affected communities, including working with VOX to assist in providing access to water for local people. Gem Diamonds established a community trust, which includes two trustees from the project affected communities and has already commissioned special projects, Gem Diamonds stated. Ghaghoo anticipates employing approximately 250 people in Botswana once full production from phase one operations is achieved in 2015. The objective of the first phase is to confirm the grade, diamond prices and the recovery processes, including the use of autogenous milling, which is expected to increase diamond output. Clifford Elphick, the CEO of Gem Diamonds, said, "We are very pleased to be bringing the Ghaghoo mine into production. This is a significant step forward for Gem Diamonds as a company as we add another mine to our portfolio of producing assets. The potential of this ore body and the economic benefits to shareholders, employees and the Botswana nation will soon become evident. We believe that our steadfast approach and commitment to being an excellent corporate citizen and working to ensure we operate in an environmentally and socially responsible manner is key in determining the long term success of the Ghaghoo mine. “The mine and our investment to date demonstrates our commitment to the country and to the people of Botswana. We see considerable opportunities in playing an important role in the country’s future and bringing jobs and economic opportunities to the surrounding communities,” Elphick said.
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