Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
The government of Botswana has established a new diamond trading company that will be responsible for the purchasing, selling and marketing of the state’s portion of Debswana Diamond’s production, reports Botswana’s daily Mmegi.
Debswana, the world’s leading producer of diamonds by value, is a 50-50 joint venture between giant diamond company De Beers and the government of Botswana. The latest is entitled to 10-15% of the company’s production, as a result of a marketing agreement signed with De Beers in September last year.
The recently formed company, named Styled Okavango Diamond Trading Company, is expected to independently auction an estimated US$300 million to $350 million worth of diamonds on the open market a year from Debswana’s average US$3 billion-a-year supply.
In his Committee of Supply speech to Parliament last week, the Minister of Minerals, Energy and Water Resources, Ponatshego Kedikilwe said his ministry had completed the incorporation of the private company, which is wholly owned by government.
Last month, De Beers said it was still holding 2.2 million carats of diamond supply that belongs to the government of Botswana out of Debswana’s 22 million carats production in 2011.
Debswana operates four diamond mines in central Botswana, as well as a coal mine.
