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De Beers Moves Forward on Botswana Diamond Deal

October 1, 2023  |  Leah Meirovich
De Beers rough diamonds under loupe 1280 USED 100123

De Beers and Botswana have signed a “heads of terms” document, the next step in hashing out a new contract for their joint Debswana mining venture.

The heads of terms, or letter of intent, resolves some of the key issues between the parties regarding the mining deal, which will include a new 10-year sales agreement for Debswana’s rough-diamond production and extend De Beers’ mining license in the country until the end of 2054. The document also provides further detail and clarity on the deal’s commercial and operations aspects, De Beers said Sunday.

The topics under discussion included the Diamonds for Development Fund — a project to help diversify Botswana’s economy — Debswana supply allotments, economic arrangements, talent development, and value-chain development, De Beers elaborated.

“This is an important step forward as we progress toward finalization of the contracts and implementation of the transformational new agreements,” said Lefoko Maxwell Moagi, Botswana’s minister of minerals and energy. “The new chapter we are embarking on will see more skills development and job creation for Batswana, and more diamond beneficiation locally. This important milestone heralds an exciting new era in Botswana’s development.”

The two entities signed an “agreement in principle” in July, which allotted 30% of Debswana production to Botswana’s state-owned trading business, Okavango Diamond Company. That percentage will increase progressively to 50% during the 10-year agreement. De Beers also plans to partner with Botswana in selling exceptional diamonds, with both parties taking a share of the polished profits.

“We in De Beers are proud of our long partnership in Botswana, and we are excited about the role we can play in Botswana’s future,” said company CEO Al Cook. “We are very pleased to have signed the heads of terms for an agreement that will deliver large new investments, supporting the country’s development aspirations.”

Main image: A loupe and rough diamonds. (Ben Perry/Armoury Films/De Beers)

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