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Debswana to spend P20 billion on expansion

Staff Writer
Debswana will spend $3 billion (P20 billion) over the next 15 years on extending the life of Jwaneng Mine.

Cut 8, as the project to extend the life of the world's biggest diamond operation by production value is styled, "will ensure profitable and continuous production at the mine until at least 2025", De Beers Managing Director, Gareth Penny, said at a Diamond Town Hall Meeting at GICC on Tuesday. The project is expected to create access to a further 95 million carats of diamonds and create 1 000 jobs during construction.

"This is the single largest investment ever made in the private sector in Botswana and it shows the confidence we have in this industry," Penny told an audience that included some of the leading diamond manufactures in the world.

Debswana, which is a joint venture between De Beers and the government of Botswana, announced recently that its board had approved $500 million (P3.5 billion) for the start of the project.

Currently Jwaneng is mining to a depth of 330 metres and is expected to reach 650 metres by 2017. Earthworks at the site commenced in late March 2009 for the refurbishment of an existing construction camp. Construction activities began last month and are scheduled for completion in November 2011.

Answering a question from VPB (formerly Venture Partners Botswana) CEO Anthony Siwawa about how Batswana companies would benefit from the P20 billion to laid out for Cut 8, the Managing Director of Debswana, Blackie Marole, said certain activities would be reserved for local companies.  Seventy- five percent of Debswana's procurement is imported. Marole said they

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would make a deliberate effort to source some services for Cut 8 locally. To that end, Debswana recently asked local companies to register with them for consideration of constructing campsites for Cut 8 and Morupule Colliery, Debswana's coal-mining subsidiary.

"Most of the activities like excavating rock and transporting stockpile and ore are all done locally, which means it will benefit local companies," Marole said.

In response to Business Week, Group Public and Corporate Affairs Manager, Esther Kanaimba-Senai, recently said although the company had just come out of a dry patch due to the global recession, the Cut 8 project was critical to the life of Jwaneng Mine.

"Without it, mining at Jwaneng would be severely curtailed post 2017 as ore from Cuts 6 and 7 would almost be depleted," Kanaimba-Senai said. "Diamonds from Cut 8 will only come on stream in 2017. The project involves planning, preparation and implementation of activities associated with the next cut of waste to further expose the existing ore body."

The Cut 8 project involves the widening and deepening of the existing Jwaneng pit as a short-term alternative to going underground. The project will strip 713 million tonnes of waste in order to expose 75 million tonnes of ore and 95 million carats.

This will take place at the rate of 122 million tonnes of waste per year. In widening, the project will result in mining out areas where current mining and plant infrastructure are situated.



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