Jwaneng Debswana
Debswana's Jwangeng operation in Botswana

The Debswana Diamond Company, a 50/50 joint venture between the government of Botswana and De Beers Group, recently announced a new life extension project for its flagship mine, Jwaneng, in Botswana.

Following closely on the heels of Cut-8, the US$2 billion Cut-9 expansion project will secure the operation’s future for at least another five years while retaining its status as the largest revenue generator for the company, writes LAURA CORNISH.

This article first appeared in Mining Review Africa Issue 6, 2019
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Since its establishment in 1969, Debswana has over the decades become a significant contributor to Botswana’s economy with more than 80% of its profits being returned to the people of the country.

This equates to approximately 50% of public revenue, 3% of GDP, and over 80% of foreign earnings to the country.

Jwaneng, situated about 160 km from Gabarone in south-central Botswana, is by far the greatest contributor to the delivery of such significant economic contributions.

Approximately 70% of Debswana’s total revenue, and 50% of its total diamond recovery, is generated by the mine.

In order to retain its position within the company and Botswana, in March Debswana announced the approval to extend the lifespan of the mine beyond 2024 by commencing with the development of Cut-9, which will see Jwaneng continue operating until at least 2035.

Cut-9 close-up

Once in operation, Cut-9 is expected to yield 52 million carats of diamonds for its shareholders, the government of Botswana and De Beers. It not only provides job security to some 2 000 personnel on site but will further create around 1 000 jobs during the peak phases of project delivery.

“It is a time-critical stay-in-business project which will generate significant cash flows and extend the life of Jwaneng mine,” says Lenayang Dimbungu, head of technical services at Debswana.

While the current mining operation is expected to have depleted ore by 2029, the work required to expose the new diamond-bearing material will take several years and so to ensure operational continuity, the decision was taken to proceed well in advance.

“To expose the ore, Cut-9 must remove approximately 513 Mt of waste material and process 44 Mt of material to maintain continuity of ore supply from the pit,” Dimbungu confirms.

“The waste removal process will take us through to 2027 and has been outsourced to a mining contractor. Once the ore is exposed, the project will be handed over to operations to mine ore until 2035.”

The contract to provide the full suite of required diamond mining services has been awarded to Majwe Mining, a joint venture between Bothakga Burrow Botswana and Thiess Botswana.

This portion of the project alone is valued at $1.2 billion. Having successfully delivered the Cut-8 project previously, Majwe is well suited to delivering on Cut-9.

Cut-8 became the main source of ore for Botswana’s Jwaneng mine in 2018, increasing the depth of the mine from 400 m to 650 m, ensuring continuous production until at least 2024.

It provided access to an estimated 88 million carats of mainly high-quality diamonds from about 75 Mt of material.

“The extension of Jwaneng mine secures Botswana’s rightful place as a leading diamond producing nation for years to come. With global consumer demand for diamonds reaching record levels in 2018, the extension will enable us to continue to meet the needs of our consumers all over the world,” says Bruce Cleaver, chairman of Debswana.

“We are deeply proud of the central role Jwaneng mine has played in Botswana’s remarkable development story and of the role this investment will play in its future.”

Retaining its steadfast performance

Debswana says it aims to keep production at around 24 million carats in 2019 having increased diamond output by 6% to a four-year high of 24.1 million carats in 2018, buoyed by strong demand from the United States, China and India.

Of total production, Jwaneng’s attributable diamond delivery was 11.9 million carats.

“I see the year staying as we budgeted at 24 million carats. There is no reason for us to change production forecasts,” concludes Debswana MD Albert Milton.