HomeDiamonds & GemstonesPortuguese to sell Angolan mine

Portuguese to sell Angolan mine

Diamonds “’ they seem
to have lost their
shine for Portugal
Lisbon, Portugal — MININGREVIEW.COM — 04 August 2009 – The government of Portugal is seeking to sell its 49% stake in the Angolan diamond miner Sociedade Mineira de Lucapa, according to a report in the newspaper Publico.

Reporting from here, Reuters said the stake in the Angolan company was held by the Portuguese Entrepreneurship Society (SPE), which is 81% owned by the Portuguese government. Angola’s state company Endiama controls the Lucapa mine via its 51% holding.

“It doesn’t make sense keeping this stake in strategic terms. We are selling, regardless of the results,” Publico quoted Portugal’s treasury and finance secretary Carlos Pina as saying.

Diamond firms in Angola are struggling to recover from a 75% drop in gem prices last year caused by the global economic downturn. The price slump prompted BHP Billiton “’ the world’s biggest miner “’ to abandon its exploration projects in Angola.

Publico said SPE has been loss-making for the past two years, both in net and operating terms. Last year’s net loss was 1.4 million euros (R15.4 million) and operating loss totalled 1 million euros (R11 million).

Endiama said last month it expected to produce between 7 and 9 million carats of diamonds in 2009, compared with 8.9 million in 2008.

Angola is one of the world’s top five diamond producers.