Namdeb Diamond Corporation, a 50:50 joint venture between De Beers Group and the government of Namibia, has approved a new long-term business plan that will extend the current life-of-mine (LoM) of its land-based operations as far as 2042.
Under the previous business plan, the land-based Namdeb operations would have come to the end of their life at the end of 2022 due to unsustainable economics.
However, a series of positive engagements between the Namdeb management team and the government of Namibia has enabled the creation of a mutually beneficial new business plan that extends the LoM by up to 20 years, delivering positive outcomes for the Namibian economy, the Namdeb business, employees, community partners and the wider diamond industry.
As part of the plan, the government has offered Namdeb royalty relief from 2021 to 2025, with the royalty rate during this period reducing from 10% to 5%.
This royalty relief has, in turn, underpinned an economically sustainable future for Namdeb through an LoM extension that, through the additional taxes, dividends and royalties from the extended LoM, is forecast to generate an additional fiscal contribution of about N$40-billion for Namibia.
Meanwhile, the LoM extension will also deliver ongoing employment for Namdeb’s existing employees, the creation of 600 additional jobs, ongoing benefits for community partners and about eight-million carats of additional high-value production.
“Namdeb, a shining example of partnership, has a proud and unique place in Namibia’s economic history. This new business plan, forged by Namdeb management and enabled by the willingness of government to find a solution in the best interest of Namibia, means that Namdeb’s future is now secure and the company is positioned to continue making a significant contribution to the Namibian economy, the socioeconomic development of the Oranjemund community and the lives of Namdeb employees," says De Beers CEO Bruce Cleaver.
Namibian Mines and Energy Minister Tom Alweendo comments that mining remains the backbone of the country's economy and is one of the largest employment sectors.
"Government understood the fundamental impact of what the Namdeb mine closure at the end of 2022 would have had on Namibia. Therefore, it was imperative to safeguard this operation for the benefit of sustaining the life-of-mine for both the national economy as well as preserving employment for our people and the livelihoods of families that depend on it.
“After more than a century of production, these operations were approaching the end of their life, but the creation of this new business plan means we can continue to deliver for Namibia for many years into the future."
"This is great news for the hardworking women and men of Namdeb, as well as for all our community partners who we are proud to have worked with over the years. We now look forward to starting a new chapter in Namdeb’s proud history,” adds Namdeb CEO Riaan Burger.