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Namibia to Renegotiate Deal With De Beers

As Botswana and the De Beers Group reached a mutually beneficial 50/50 diamond deal, the Namibian Government is preparing for a possible change in its collaboration with the diamond company.

Last week, the Botswana government and De Beers announced they have reached a 10-year sales agreement for the rough diamond production of Debswana on a 50% share, extending to 2033.

The new terms shift in favour of the Botswana government, compared with a 2011 agreement which gave it a 25% share.

Furthermore, the parties have also secured a 25-year mining licence for Debswana, ensuring a stable mining operation until 2054.

Meanwhile, under the existing agreement, Namibia receives a modest 15% share in its partnership with De Beers, which expires in May 2026.

While negotiations similar to Botswana’s lucrative arrangement have not yet taken place in Namibia, Ministry of Mines and Energy spokesperson Andreas Simon has confirmed that preparations are underway for the impending negotiations.

“The ministry has started to prepare for the negotiations which will come. In addition, the terms of reference for the negotiations are yet to be determined by the preparation team,” Simon says.

Earlier this year, mines minister Tom Alweendo expressed the possibility of increasing the government’s revenue share from local diamonds through negotiations with De Beers.

“Right now we are at 15%, and therefore, when we review the agreement, we would also look at increasing the 15% to something else,” Alweendo told the media at the sidelines of a meeting with his Angolan counterpart in April.

The new Botswana agreement comes after Botswana’s president, Mokgweetsi Masisi, warned that his country could sever ties with De Beers if talks to renegotiate a sales agreement prove unfavourable for his country.

After Botswana, Namibia is the second-biggest diamond producer for De Beers.

De Beers’ production in Namibia increased by 51% to 0,6 million carats in the fourth quarter of 2022, primarily driven by the continued strong performance from the Benguela Gem vessel and the treatment of higher grade ore at land operations.

Source : Namibian