HomeDiamonds & GemstonesDe Beers expects 50% boost in output this year

De Beers expects 50% boost in output this year

One of the vessels
used by De Beers to
scoop up diamonds
from the sea floor
Johannesburg, South Africa — MININGREVIEW.COM — 07 October 2010 – Diamond mining giant De Beers “’ the world’s largest diamond producer “’ expects to boost output in South Africa by nearly 50% this year as global demand recovers, but has abandoned an effort to mine gems in the country’s coastal waters.

“South Africa’s diamond output would jump to about seven million carats in 2010 from 4.8 million carats last year, when some mines were temporarily shut due to the global downturn, said Barend Petersen, acting CEO of the group’s local unit De Beers Consolidated Mines.

De Beers, which controls around 40% of the rough diamond market, also plans a R15billion investment over 10 years at its flagship Venetia mine, to maintain output and extend mine life to 2043, Petersen said in an interview here.

He added that De Beers, which also operates in Canada, Botswana and Namibia, would produce an estimated 31 million carats for the group in 2010, up from 24.6 million carats the previous year.

Petersen went on to explain that De Beers had consolidated all its marine diamond operations in Namibian waters, abandoning an effort off the South African coast after obtaining low grade gems there.

De Beers has long used sophisticated vessels to scoop up gems from the sea floor off Namibia, and in 2006 launched a project worth nearly R1billion to outfit another vessel and use the same techniques off the South African coast. “In the Namibian waters, it was an exceptional turnaround. So in terms of our marine business, it’s clearly more advantageous for us to mine the sea waters of Namibia than the South African sea waters,” said Petersen.

He revealed that plans by the South African unit to sell its Namaqualand and Finsch diamond mines would be concluded as expected by the first half of 2011, to enable it focus on profitable units.

“We have decided that we should stop the bleeding. We will sell off underperforming units over time,” he said.