Jwaneng anchors output jump at Debswana
Brian Benza | Friday October 28, 2016 16:35
According to figures released by parent company, Anglo American, production at Jwaneng rose by 47% as a result of planned maintenance in the third quarter of 2015 being prioritised in light of trading conditions. However, the huge output rise at Jwaneng was partly offset by a planned 22% decrease at Orapa to align aggregate production to trading conditions.
“The modestly higher production at De Beers is reflective of improved market conditions relative to the third quarter of 2015, but we maintain a cautious outlook,” Anglo chief executive officer, Mark Cutifani said.
Anglo owns 85% of De Beers, which in turn is a 50% each joint partner with government in Debswana. On a year-to-date basis, production at Debswana stood at 15.06 million carats in the first nine months of the year.
Debswana targets to keep production at a flat 20 million carats this year, as it remains cautiously optimistic of the market despite signs of improvement in 2016.
For De Beers, diamond production increased by four percent to 6.3 million carats compared with the third quarter of 2015 when production was reduced in response to the prevailing trading conditions.
Production at DBCM (South Africa) increased by six percent to 1.1 million carats largely as a result of processing higher grades at Venetia and increased throughput at Voorspoed. This was partly offset by the early completion of the sale of Kimberley Mines in January 2016.
Production at Namdeb Holdings (Namibia) decreased by 13% to 0.4 million carats with lower grades at Namdeb Land, and the Debmar Pacific vessel being in port for planned maintenance in the third quarter of 2016 at Debmarine Namibia.
Production in Canada decreased by 48% to 0.2 million carats due to Snap Lake being placed on care and maintenance in December 2015. This was partially offset by first production at Gahcho Kué. Gahcho Kué was officially opened on September 20, 2016 and ramp-up is progressing well.
In terms of sales, consolidated rough diamond sales in the third quarter of 2016 increased by 77% to 5.3 million carats.
“This increase reflected improved trading conditions from those experienced in the third quarter 2015, when higher pipeline stock impacted midstream demand,” Cutifani said.
From a high of 34 million carats in 2007, diamond production, which contributes just over 20% to Botswana’s GDP and 65% to foreign exchange receipts, has plateaued in the last few years as Debswana caps production to match weakening market conditions.
In the medium to long-term, De Beers expects industry fundamentals to strengthen as global diamond production plateaus and demand continues to steadily increase.