Botswana Diamonds (LON:BOD) said Thursday that it had received a “critical” environmental authorization for diamond-bearing gravels from the Marsfontein mine, next to the company’s own Thorny River project, in South Africa.
The company noted the permission, granted to its associated firm Vutomi, was a critical step towards obtaining a mining permit, which it expected to receive shortly.
“We believe the mine gravels
and unprocessed stockpiles around the Marsfontein mine contain commercial
grades of diamonds,” chairman John Teeling said.
Botswana Diamonds has identified
potential partners to process the gravels and stockpiles.
The company, which has long believed there should be high grade kimberlite pipes other than the Marsfontein mine in the Thorny River area, said it expected mobilization to begin within six weeks.
Diamond miners are struggling across the board, especially those producing
cheaper and smaller stones where there is too much supply.
Buyers, those that polish and cut
diamonds for retailers, have been hit this year by lower prices and tighter
credit, prompting them to delay purchases. Tiffany’s reported in August
a 3% decline in like-for-like sales, while shares in Signet, the world’s largest
retailer of diamond jewellery, have lost more than 60% of their value this
De Beers, the world’s top diamond
producer by value, has responded by axing production — with a target of 31
million carats this year compared with 35.3 million in 2018. It has also
announced it would spend more on marketing.
At the latest sale, the
company increased the amount of stones buyers were allowed to reject in
each lot purchased from 10% to 20%, according to people familiar with the