Botswana Diamonds has analysed and evaluated nearly 400 000 km of airborne geophysical and other exploration data using AI techniques and powerful computing, which would otherwise have been too big for timely analysis by humans.
In particular, the company has identified seven significant kimberlite targets on existing licences that have not been reported before.
The AI programme has also revealed compelling polymetallic targets in areas that are currently unlicensed.
Work is ongoing on these new areas of interest which now focuses on four main deposit types and 11 subtypes. These deposit types include elements such as gold, copper, silver, nickel, zinc and platinum group metals.
Botswana Diamonds used UK-headquartered Planetary AI’s ‘Xplore’ mineral prospectivity platform to perform the detailed analysis.
Xplore Platform is software that enables targeting of any element based on a plethora of geological and topographic information.
Botswana Diamonds chairperson John Teeling comments that these discoveries, in a few short months, are a major step forward in mineral exploration. One anomaly is especially intriguing to the company and the AI programme has reinforced the company’s belief that more diamond mines will be discovered in Botswana.
The company currently operates three diamond mines in Botswana and it also holds assets in South Africa.
Botswana’s central bank left its main lending rate unchanged on Thursday, saying the economy was expected to operate below capacity and not generate demand-driven inflationary pressures because of a slump in the global diamond market.
The Bank of Botswana held its Monetary Policy Rate at 1.90% for the second policy meeting in a row. The rate is based on a seven-day instrument.
“The economy will contract this year primarily due to the downturn in the global diamond market and moderately recover next year,” central bank Governor Cornelius Dekop told a news conference.
The southern African country’s economy is largely dependent on the export of diamonds, and declining earnings from the precious stone have limited government spending.
The central bank also lowered its primary reserve requirement to 0% from 2.5% due to significantly reduced liquidity in the banking system.
Dekop said inflation was expected to average 2.9% in 2024 and 3.3% in 2025, compared with forecasts of 2.8% and 3.1% given at the bank’s previous monetary policy meeting in November.
The Bank of Botswana prefers inflation between 3% and 6% over the medium term. Annual inflation stood at 1.6% in October.
Major African diamond producer Botswana will join Antwerp as an origin certifier of rough diamonds for export to the G7 which banned imports of Russian stones from the start of this year, a joint statement said on Wednesday.
The addition of Botswana looks set to salvage implementation of the ban. The initial system would have seen all diamonds go through Europe’s diamond hub in Antwerp for verification, backed by a new tracing system.
African diamond producers Angola, Botswana and Namibia, as well as diamond miner De Beers, had said the mechanism was unfair and would hurt their economies.
“Botswana and the G7 diamond technical team are now crafting a roadmap to address any identified gaps, aiming to have the export certification node fully operational in Botswana as soon as possible next year,” the statement said.
The Group of Seven (G7) nations ban on direct Russian diamond imports took effect on Jan. 1, followed by a ban on Russia-origin diamonds via third countries from early March.
The tracing system was meant to be up and running by Sept. 1, but the EU delayed the implementation to March 2025.
Canada’s Lucara Diamond has dug up a 1,094 carat diamond from its Karowe mine in Botswana.
This is the sixth diamond weighing more than 1,000 carats to be recovered at the mine, and it comes only weeks after the recovery of a 2,492 carat diamond the second-largest diamond ever recovered.
“This remarkable stone bears striking similarities to the 692 carat diamond announced in August 2023, which was polished by HB Antwerp and yielded polished diamonds that sold for in excess of $13 million,” the company said in a press release.
“This newly recovered 1,094 carat stone will also be polished by HB Antwerp, as part of the ongoing partnership between the two companies,” Lucara said.
The Karowe mine has produced several large diamonds in recent years, including the 1,758-carat Sewelô in 2019, the 1,109 carat Lesedi La Rona in 2015, and the 813 carat Constellation, also in 2015. The mine is also credited for having yielded Botswana’s largest fancy pink diamond to date, the Boitumelo.
Botswana is the world’s largest producer of diamonds, and the trade has transformed it into a middle-income nation.
Karowe remains one of the highest margin diamond mines in the world, producing an average of 300,000 high value carats each year.
Shares of Lucara rose 8% by 11:40 a.m EDT in Toronto. The miner has a market capitalization of C$221 million ($162 million).
Botswana’s state-owned diamond marketing company will increase its borrowing to fund additional rough purchases.
Finance Minister Peggy Serame said last Thursday (29 August) that the government had arranged a $300m credit facility, with the Standard Chartered Bank for the Okavango Diamond Company (ODC).
It hopes to capitalize on a long-awaited recovery the global diamond market.
At the moment ODC’s limited cash reserves mean it can only buy $70m of its allocation of diamonds produced by Debswana, the 50/50 joint venture between De Beers and the Botswana government.
ODC holds 10 auctions a year to sell its 25% allocation from Debswana. That share is set to double to 50 per cent over the next decade, as part of a deal agreed last year between Botswana and De Beers.
Last October ODC halted its rough sales amid weak demand.
Namibia is one of Africa’s top five diamond exporters, right behind Angola, Botswana, and South Africa. In 2022, the country exported more than $940 million worth of diamonds.
The world’s demand for natural diamonds has bounced back from a slump during the COVID-19 pandemic, with Namibia’s largest marine dining company, Debmarine, reporting a sales increase of 83% in 2022 from the previous year.
Still, Debmarine CEO Willy Mertens is worried about competition from synthetic diamonds, sector of the business that could cost many Namibians their jobs.
Though trained jewelers can tell the difference between lab-grown and natural diamonds, there’s nothing obvious to distinguish lab-grown diamonds from natural ones.
The Modern Mining publication recently said that in 2022, lab-grown diamond jewelry surpassed 10% of the market of global jewelry sales for the first time. The publication said artificial diamond sales are forecast to continue growing at an annual double-digit percentage rate in coming years.
Namibia, where workers extracted 2.1 million carats in diamonds in 2022, is embarking on a campaign to tout natural diamonds as environmentally sound and holding greater value for the money.
“We’ve seen in the past couple of years that lab-grown diamonds, or synthetics as you call them, have sort of infiltrated the natural diamond market,” said Mertens. ” … people were first marketing them as real diamonds and we’ve done a lot of work around trying to differentiate them.”
One of the challenges of marketing Namibian natural diamonds is the environmental impact that diamonds have on the landscape.
Mertens said Debmarine invests a significant amount of its profits into environmental rehabilitation and restoration of landscapes and the seabed damaged by mining.
“The restoration of the seabed actually happens naturally as the waves move,” Mertens said. “So what we are doing is that we are monitoring that, and what we do is we mine out a specific area and we leave an area next to it vacant, and over time we monitor how the area where we have recovered diamonds looks like compared to the one that was not touched and we’ve seen that it takes about three to 10 years maximum for that to completely restore. By completely restoring, mean about 70% of the organisms have returned to that place. On the land, it is sand that we are moving and what we do now is that we are using that same sand to keep the sea walls in tact.”
Mertens recently paid a courtesy call on Namibian President Nangolo Mbumba, to introduce the De Beers global ambassador for natural diamonds, Hollywood actor Lupita Nyong’o, and talk to the president about challenges facing Namibia’s diamond industry.
De Beers Natural Diamonds Global Ambassador Lupita Nyong’o, left, Namibia President Nangolo Mbumba, center, and Debmarine CEO Willy Mertens in Windhoek, Namibia, July 19, 2024. (Vitalio Angula/VOA) De Beers Natural Diamonds Global Ambassador Lupita Nyong’o, left, Namibia President Nangolo Mbumba, center, and Debmarine CEO Willy Mertens in Windhoek, Namibia, July 19, 2024. (Vitalio Angula/VOA) President Mbumba lamented a proposal for the Kimberley process — the process meant to screen out so-called “conflict diamonds” from entering the international market — to begin certifying all diamonds in Antwerp, Belgium.
The Group of Seven largest economies said that is an effort to prevent Russian diamonds from being sold abroad.
Mbumba said the measure would hurt African diamond producers.
“Recently, the decision was made by the G7 countries to route all rough and polished diamonds destined for G7 countries via Belgium,” said Mbumba. “This decision poses a serious risk and threat to our economies, especially the economies of Angola, Botswana and Namibia by increasing the cost as well as curtailing freedom of trade for our countries’ products.”
Namibia’s president said he and his counterparts from Angola and Botswana have written a letter to the G7 to ask them to halt their plans.
Botswana intends to renegotiate its proposed purchase of a stake in Belgian gem dealer HB Antwerp to double the size of its shareholding at no extra cost following the downturn in the diamond market, the country’s mines minister said on Tuesday.
Botswana is the world’s biggest diamond producer by value, meaning its economy has been disproportionately hit by a drop in demand for diamonds caused by a global economic slowdown.
Lefoko Moagi told Parliament the weaker diamond market had also affected the company’s valuation, giving the country room to renegotiate.
“We will not be injecting more capital, but we will get more shares for the same amount proposed in 2023,” Moagi said. “Instead of the 24%, we will negotiate to get 49.9% for the same amount initially proposed.”
Finance ministry budget documents showed in February that the country had set aside 890 million pula ($65.95 million) for the 24% stake, valuing the Belgian company at about $275-million.
The HB Antwerp deal was announced during Botswana’s negotiations for a new sales contract with Anglo American’s diamond unit De Beers in March 2023.
As Botswana sought to increase its power to market its stones outside a decades-old agreement with De Beers, it said the HB Antwerp deal would strengthen its presence in the downstream diamond industry.
It includes supplying the trader with rough diamonds for five years through the state-owned Okavango Diamond Company (ODC).
According to Botswana’s central bank data, sales of rough diamonds at Debswana Diamond Company fell by 49.2%, amounting to $1.29 billion compared to $2.54 billion in the same period last year.
In local currency, sales of rough diamonds decreased by 47.3% to 17.555 billion pula compared to the same period last year.
This decline in sales is a major blow to the South African nation, which derives 30%-40% of its revenue, 75% of its foreign exchange earnings, and a third of its national output from sales of rough diamonds.
The report highlighted the downturn in the global diamond market as the primary reason for this sharp decline.
In response to the weak consumer demand, Anglo American cut its diamond production by 19% in the first six months of the year.
The report highlighted the downturn in the global diamond market as the primary reason for this sharp decline.
Botswana derives 30%-40% of its revenue, 75% of its foreign exchange earnings, and a third of its national output from sales of rough diamonds.
The Debswana Diamond Company is a joint venture between the government of Botswana and Anglo American Plc’s De Beers. Anglo American Plc’s De Beers sells 75% of its output to De Beers, while the balance is taken up by the state-owned Okavango Diamond Company.
Despite the current economic challenges, Botswana and De Beers signed a ten-year diamond sales agreement in June.
This deal will gradually see the share of Debswana’s output sold by the state-owned company increase from 25% to 30% before it goes up to 40% in five years and eventually 50% by the end of the new contract.
According to the key points in the agreement, this strategic move aims to boost Botswana’s revenue from its diamond resources.
Debswana Jwaneng Diamond mine, Botswana, South Africa
De Beers reported a 15 per cent drop in its global diamond production in Q2, as demand remained weak for yet another quarter.
The H1 figure (16.5m carats) is down 19 per cent on the same period in 2023.
The total number of carats recovered during Q2 2024 was 6.4m, down from 7.6m year-on-year. Botswana, which accounts for around two thirds all De Beers’ production, was worst hit, with output down 19 per cent.
De Beers blamed “intentional lower production from short-term changes in plant feed mix at Jwaneng to process existing surface stockpiles”.
Jwaneng, De Beers’ biggest deposit saw output drop 36 per cent during the quarter, from 2.5m carats to 1.9m.
Production in Namibia was down 8 per cent, Canada slipped 1 per cent and South Africa increased by 8 per cent.
In its Production Report for the Second Quarter of 2024, De Beers said guidance for the year remained unchanged at 26m-29m carats.
But parent company Anglo American has indicated that production for the year (originally given as 29m-32m carats) could well be further reduced to manage working capital and preserve cash in a weak market.
Botswana’s economy contracted by the most since the peak of the pandemic in early 2020, after diamond production plunged.
Gross domestic product shrank an annual 5.3% in the first quarter, compared with growth of 1.9% in the prior three months.
The downturn was primarily influenced by a decrease in real value added of the diamond traders and mining & quarrying industries of 46.8% and 24.8% respectively, Statistics Botswana said in a report Friday.
Botswana is the world’s largest producer of rough diamonds by value, with the revenues making up the bulk of the southern African country’s budget receipts. The decline is likely to make meeting its fiscal targets for this year difficult. The central bank already warned last week that the government would probably miss its economic growth forecast of 4.2% because of weaker mining output.
The global diamond industry almost came to a standstill in the second half of last year as De Beers and Russia’s Alrosa PJSC — the two biggest miners — all but stopped supplies in a desperate attempt to stem a slump in prices. That hit earnings at De Beers, which mines more than three-quarters of its diamonds in Botswana.
Earlier this year De Beers said it expects any recovery in the beleaguered diamond market to be slow and gradual as the industry continues to suffer from weak economic growth in key markets such as China and the US.
