Botswana Wants Local Supply, as Jwaneng Talks Drag On

As Debswana got word that the Jwaneng diamond mine license will be extended a few months, Botswana ministers say that negotiations are not over yet, and would like to see the country gain more from the diamond trade now that they know more about it.

As negotiations are extending longer then expected, the Jwaneng diamond mine will continue to be operated by Debswana, said yesterday (Monday) Akolang Tombale, permanent secretary in the Ministry of Minerals, Energy and Water Affairs, apparently to allow mining to continue until negotiations are concluded.

“We have extended the current license to the end of the year,” Tombale told the SAPA news agency, referring to the world's richest diamond mine.

But he refused to comment on speculations that the government is pressuring Debswana to promote local downstream initiatives.

“Cutting and polishing of diamonds is within our program,” said Finance Minister Baledzi Gaolathe. “This need not be done by Debswana, but other companies in Botswana. We would like to see De Beers and Debswana facilitating the supply of diamonds to the companies we may attract to cut and polish here.”

And that is the point – Botswana wants local supply, the one thing that De Beers does not want to do, but finding that from Canada to South Africa it is a growing and difficult to resist demand.

Add to that Leviev’s recent moves in Africa, highlighted by the opening of local polishing plants and other downstream partnerships amid great fanfare, and the issue a hot one.

De Beers is also facing local criticism on the topic. Last month it was an Angolan minister and other officials speaking in Israel, a week before that it was the Namibian Prime Minister, and now Finance Minister Gaolathe is adding his share.

“Obviously when we started mining diamonds, we did not have all the facts about the ore body, prices, etc. but we are more educated now. Our technological knowledge has improved,” he was quoted saying.

As this is negotiations time, he added, “All these things will be taken into account, maybe some may no longer be relevant -- maybe there will be other challenges. My hope is that as in the past, there will be give and take and goodwill. A 25 year mining lease is a major privilege and there must be commensurate benefits flowing to the government”.