https://www.miningweekly.com
James|Campbell

Local diamond mining industry still holds ‘lots of potential’ – Botswana Diamonds

Botswana Diamonds CEO James Campbell

Botswana Diamonds CEO James Campbell

Photo by Duane Daws

9th June 2017

By: Megan van Wyngaardt

Creamer Media Contributing Editor Online

     

Font size: - +

JOHANNESBURG (miningweekly.com) – With world diamond prices currently “very unexciting” and with stagnant growth forecast for jewellery sales, junior miners should think long and hard before investing in diamond exploration projects, as there is a risk of decreased investment from the market.

Speaking at the Junior Indaba, in Johannesburg, on Thursday, Cadiz Securities economist Peter Major warned that the diamond mining industry was currently “filled up”.

However, junior miner Botswana Diamonds CEO James Campbell disagreed. Speaking to Mining Weekly Online on the sidelines of the indaba, he noted that there was still steady growth in diamond demand.

“People haven’t spent money on diamond exploration and, therefore, there are no new discoveries. The only one of note is Alrosa’s Luaxe kimberlite, in Angola, but there aren’t any more,” he pointed out.

The development of the newest diamond mine, a joint venture between Alrosa and Angolan national diamond company Endiama, was announced in May, with the deposit expected to be worth more than $35-billion.

Meanwhile, Campbell pointed out that “even the large majors” were not spending too much money and have also not found recent new deposits. “The older mines are becoming deeper and more expensive, so supply is plateauing and, in the next five years or so, it will drop off,” he said.

With diamonds being an aspirational buy and with a growing middle-class emerging in Asia – including China and India – Campbell forecast a widening supply and demand gap, which would lead to a steady rebound in the diamond price.

He added that top-end producers, which deliver diamonds worth anything north of $100/ct, experienced much less volatility in diamond price growth.

Asked how juniors would find new diamond pipes, Campbell said brownfield projects were often the most obvious places to start. “However, there are many parts of the world where there hasn’t been exploration or, if there was, it was 30, 40 or more years ago.”

Campbell said that, with the advent of new technology, a junior miner such as Botswana Diamonds was able to develop a “billion-dollar asset”, while a major miner – De Beers – “walked away”.

Campbell was referring to the AK6 kimberlite project in Botswana, where the “abundance” of Type IIa and larger diamonds were inadequately considered in initial evaluations. “The operating margins are significant, so it could have been a De Beers mine today,” he said.

“Modern technology allows you to go back and look at those previously explored areas. If you look at the central Kalahari, [there is a revival] in diamond exploration,” he noted, adding that Botswana Diamonds was also currently evaluating a kimberlite pipe in the region, which was discovered by another company.

“Using different technology, we found very different and very encouraging results. You have to be in the right place and have the right technology,” said Campbell.

Meanwhile, Major quipped that if there was a diamond mining company to invest in at the moment, it would be Botswana Diamonds, as “they are selling us an option on what could be reality, an option without an expiry date and that is the kind of option I like to invest in".

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

Comments

Latest News

Magazine round up | 12 April 2024
Magazine round up | 12 April 2024
12th April 2024

Showroom

ESAB showroom image
ESAB South Africa

ESAB South Arica, the leading supplier of high-end welding and cutting products to the Southern African industrial market is based in...

VISIT SHOWROOM 
John Deere (Pty) Ltd
John Deere (Pty) Ltd

In 1958 John Deere Construction made its first introduction to the industry with their model 64 bulldozer.

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Magazine round up | 12 April 2024
Magazine round up | 12 April 2024
12th April 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.113 0.153s - 88pq - 2rq
1:
1: United States
Subscribe Now
2: United States
2: