Ghaghoo Mine sale flops

Hey days: Ghaghoo Mine was the country's first underground diamond mine PIC: GEM DIAMONDS.COM
Hey days: Ghaghoo Mine was the country's first underground diamond mine PIC: GEM DIAMONDS.COM

The planned sale of Ghaghoo Mine in the Central Kalahari Game Reserve (CKGR) has collapsed after the prospective buyer, Botswana Diamonds (BOD), failed to secure a joint venture partner to help fund the purchase.

Ghaghoo, which was the country’s first underground diamond mine, was placed under care and maintenance in February 2017 due to depressed diamond prices. At least 250 workers had their contracts terminated as a result.

Okwa Diamonds, an entity owned 10% by Botswana Diamonds with the balance held by VAST Resources, had announced its plans to take over Ghaghoo last August from Gem Diamonds. However, in February, Botswana Diamonds’ directors announced that their partners at VAST had informed the boards of both BOD and Gem Diamonds that they do not intend to proceed with the transaction.

Under the original deal, VAST was responsible for funding Okwa with the first $15 million (P184 million) of funding required for carrying out due diligence and acquiring Gem Diamonds Botswana, which is Ghaghoo’s operator. VAST was also to be responsible for funding to place the mine back into production.

This week, BOD directors said despite “intensive and advanced” ongoing discussions with interested parties, no agreement had been secured for a new joint venture partner.

As a result, the share sale agreement with Gem Diamonds had lapsed.

The directors said they had indicated their willingness to re-engage on substantially the same terms as the agreement if BOD and a new partner can finalise an agreement.

Editor's Comment
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The elections had two teams namely: Team Reshaping MISA and Team Integrity. All Team reshaping MISA member won except for one candidate for the Secretary post. One can say it was a long road to the elections, looking at the fact that it took four years for the elections to be held. MISA board elections are supposed to be held every two years, but they could not be held in time due to the outbreak of the COVID-19 pandemic, which affected many...

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