Botswana and the world’s leading diamond miner by value, Debswana is in a frantic bid to expand the life of some of its mines to boost the resource expected to diminish in the next few years. Rough & Polished’s Mathew Nyaungwa was at the Debswana’s offices in the capital, Gaborone recently, where he spoke to the group’s public and corporate affairs manager, Esther Kanaimba – Senai to find out more on this and several other issues relating to the operations of the diamond miner.
Geologists are said to have begun the second phase of the Orapa Resource Extension Project (OREP). Can you give an update on this exercise and what it seeks to achieve?
Currently the Orapa resource is classified as indicated to a certain depth. The multiphase Orapa Resource Extension Project is designed to upgrade the level of confidence in the resource that exists beneath this level, which is currently classified as inferred. The primary focus of the project targets the resource to be mined during 2017-2026, but the project is also assessing the value of potential resources at even deeper levels.
OREP Phase II started in 2010 and is an extensive diamond core drilling programme designed primarily to collect Micro Diamond samples to provide detailed grade information for the resource. OREP Phase II will also collect additional geological, geochemical, density, geotechnical and geometallurgical data that will augment the results of OREP Phase I.
Recent media reports noted that the resource at Orapa was expected to run out in 2026. Is this correct, and if it is, what does this mean for the future of the mine?
The Orapa resource will not be running out in 2026, it is anticipated that mining will progress beyond this period. Ongoing studies, development of long term mining plans and work to understand the resource at depth are among the present initiatives focused on extending the mine life.
OREP Phase 1 ran between 2006 and 2008, involving 38, 500 metres of drill core. What were the results of this exercise?
From the data collected during Phase I of the OREP programme, a new volume, geological and density model have been derived for the resources. These were the key deliverables of this phase of work. We are satisfied with the outcomes of that particular project. New geotechnical, geometallurgical and limited grade information has also been collected, which will prove extremely valuable in informing resource modeling and mine and plant design as mining continues.
Debswana is said to be preparing for the closure of Letlhakane Mine whose decommissioning is scheduled for 2014. Why is it being shut down?
Whilst open pit is planned to come to an end in 2014, there are adequate resources, such as coarse tailings, at Letlhakane Mine to ensure a certain measure of sustainability beyond 2014. In addition alternate mining options are currently being investigated to determine the economic viability of mining the resources post 2014.
Can you provide an update on the Jwaneng Cut (8) project?
Phase One mining kicked off in February and is progressing well. All the major contractors are on board and all the infrastructure works (re-crush conveyors, temporary mineral sizer, earth moving vehicles workshop, secondary silo and primary stockpile) are on target to meet the major milestones.
Debswana indicated earlier in the year that it had set a production target of 20 million carats for 2010, is this still achievable?
This is more than achievable as our mines have the capacity to produce around 33 million carats.
Can you provide your production levels since the beginning of the year to date?
As a matter of policy we only provide details of our results at the end of the year. However, with effect from this year, we will also be providing half yearly results.
Botswana’s diamond exports for the first quarter of 2010 grew 101 percent year on year to 476.9 million USD, but remained well below the average export levels recorded in the same periods of previous years. Has this growth encouraged Debswana to ramp up production as it previously said that it was ready to respond to market demand?
We have been able to meet the demand from our current production levels. We will continue to monitor the situation closely and if the need arises, we will be able to meet it.
Reports say that India may soon be able to source rough diamonds directly from Botswana, therefore cutting out all the middlemen. If this becomes a reality, do you see the move causing any impact on your operations?
Our current sales agreement is to sell to DTCB and that has not changed. If and when that changes, whatever changes there may be, will be communicated accordingly and the impact on our operations assessed at that time.
We understand De Beers and Botswana government’s current sales agreement will expire at the end of the year and it is expected that a certain percentage of Debswana production will go to the open market. Can you shed more light on this planned move and what it entails for the future of Debswana?
The sales agreement is a preserve of the shareholders and therefore I am not able to shed any light on it. We are just a baby we can not tell the father (Botswana government) what to do; rather we can only advice on the way forward, when we are asked to.
Mathew Nyaungwa, Rough&Polished, from Botswana
