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De Beers Plans to Sell South Africa Mine

Nov 29, 2017 4:54 AM   By Rapaport News
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RAPAPORT... De Beers is looking for offers for its Voorspoed diamond mine in South Africa, saying a lower-cost operator would have a better chance of maximizing value at the asset.

An operating model that is different from De Beers’ could help extend the mine’s productive life beyond 2020, enabling continued employment and economic opportunities in the local area, the company explained this week.

Rough-diamond production at the deposit in Kroonstad, Free State, fell 8% to 649,000 carats in 2016, and was flat at 480,000 in the first nine months of this year, according to Anglo American, De Beers’ parent company.

The sale would leave De Beers’ South African production focused on just the Venetia mine, after it sold the Kimberley mine to Ekapa Mining and Petra Diamonds. De Beers has invested some $2 billion to extend mining at Venetia to an underground operation.  

“Based on our experience with other operations, we believe the most responsible course of action is to give other lower-cost operators the opportunity to purchase the mine and potentially extend its life, as this will maximize the benefit for the community and the mine’s workers,” said Phillip Barton, CEO of De Beers Consolidated Mines, the company’s mining subsidiary in the country.

The miner has appointed Standard Bank of South Africa as its financial adviser for the proposed disposal.
Tags: Anglo American, De Beers, Free State, Kroonstad, Phillip Barton, Rapaport News, South Africa, Voorspoed
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