Botswana and mining company De Beers have announced, after years of negotiations, a new diamond sales deal that gives the South African country a bigger share of rough stones from their joint venture.
Debswana, a joint venture between De Beers (a subsidiary of Anglo American, a UK-listed multinational mining company) and Botswana’s government, sells 75% of its output to De Beers, with the balance taken up by state-owned Okavango Diamond Co. Under the new joint mining agreement, Botswana share of the rough stones extracted has been immediately raised from 25% a 30%, and it will rise to 50% within a decade, De Beers and government officials said. The new agreement covers a 10-year sales deal for Debswana rough diamond production through to 2033 and 25-year Debswana mining licenses.
Botswana supplies 70% of rough diamonds to De Beers that is the world’s leading diamond company. The new interim deal signed over the weekend means that the lucrative, decades-long diamond mining partnership, which had appeared on the verge of a breakdown in recent months, will continue.
While the details of the deal were still being worked out, it addresses one of the most significant grievances of the Botswana government, regarding the share of diamonds it receives in its joint mining venture with De Beers. De Beers had also agreed to invest as much as $825 million over the next 10 years to help develop the Botswana economy, the mining giant said in a statement.
