HomeDiamonds & GemstonesPetra completes Kimberley Underground Mines deal

Petra completes Kimberley Underground Mines deal

Petra’s Kimberley
Underground mine
London, England — MININGREVIEW.COM — 20 May 2010 – Petra Diamonds – now one of the world’s largest independent diamond groups in terms of resources – has finally completed a deal to buy the Kimberley Underground Mines from De Beers – a transaction which has taken nearly 30 months to complete.

The Petra statement released here explained that the agreement had been struck in September 2007 but, “has taken longer than originally anticipated to complete due to complexities related to the new order mining right (NOMR) which have now been completely resolved”.

Petra paid R78.5 million for the mines. Of this, R15 million was in cash and the balance was settled by taking on De Beers rehabilitation obligations regarding the Kimberley Underground mines.

Petra has run Kimberley Underground on a care and maintenance basis since September 2007. It has built up ore stockpiles of about 500 000 tonnes, containing an estimated 90 000 carats of diamonds.

During this period, Petra has ploughed R204.6 million of its own funds in new infrastructure at the operation and capitalised this investment. The capex included construction of a new diamond recovery plant at the Joint Shaft, which will treat production from the Bultfontein and Dutoitspan pipes.

A similar plant costing about R85 million will now be built at the Wesselton Shaft and should be commissioned by June 2011.

It is planned to start treating the stockpiled ore immediately, and Petra CEO Johan Dippenaar expects the operation to be cash positive and profitable from month one.