HomeDiamonds & GemstonesDe Beers suspends output at SA's largest alluvial mine

De Beers suspends output at SA’s largest alluvial mine

The Namaqualand
diamond coast
 
Johannesburg, South Africa — MININGREVIEW.COM — 14 December 2009 – The De Beers Group “’ producer of about 40% of the world’s diamonds “’ is to suspend output at South Africa’s largest alluvial mine in the first quarter of 2010, after the world economic slump slashed international demand for luxuries.

“The Namaqualand operation will be suspended for the foreseeable future,” De Beers revealed here in an e- mailed response to questions from Bloomberg News, without giving a reason. It had previously forecast output of about 330 000 carats at the site on the west coast, where diamonds are mined from deposits of old gravel beaches and river channels.

Bloomberg News reports that the world’s biggest diamond producer cut overall output by about half this year from 48.1 million carats in 2008. De Beers shareholders Anglo American Plc, the Oppenheimer family and Botswana’s government also agreed in principle to inject about US$1 billion (R7.5 billion) into the gem company to reduce its debt.

“They’re probably looking at it from a pure economic point of view,” James Allan, “’ a founder of Johannesburg-based Allan Hochreiter, which advises on mineral deals “’ said by mobile phone. “They’re managing cash flows, as they should be doing.”

Diamond sales were at about 47% of the level of a year earlier, according to De Beers managing director Gareth Penny.

The South African unit of De Beers produced 6.37 million carats in the first half of the year, making it the second-biggest of the group’s production regions after Botswana. The company “’ which accounts for about 90% of South African diamond output “’ didn’t give a percentage figure for its use of mining capacity in the country in the response to questions yesterday.

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