The State-owned Empresa Nacional de Diamantes de Angola (Endiama – National Diamond Company of Angola) will not need additional investors to develop its Luaxe project, assured company president António Carlos Sumbula at the Angola Business Forum during the recent Mining Indaba in Cape Town.
Endiama is negotiating the funding of the project with its current partners and “does not require [additional] investors,” he said.
The Luaxe kimberlite was discovered by Endiama, in association with Russian diamond group Alrosa. It is expected to be bigger than the Catoca operation, currently the biggest (by far) diamond mine in Angola, with an average annual production of some six-million carats. Luaxe is expected to produce about ten-million carats a year when it reaches full production.
Last September, Alrosa CEO Andrei Zharkov said that Endiama would have a 30% share in Luaxe and other Angolan companies combined would have 20%, while Alrosa and Catoca would together hold 50%, with the Russian group taking the “major part” of that 50% and Catoca having “the smaller part”. Catoca, which operates the mine of the same name, is owned by Endiama (with a 32.8% share), Alrosa (also 32.8%), the Diamond Finance Company BV Group (16.8%) and Odebrecht (16.4%).
Zharkov further stated that Luaxe would need investments of $200-million to $300-million to be launched and full development would require $1-billion. He estimated that the project would enter production in three to four years – that is, in 2019 or 2020. Its reserves have been estimated at 350-million carats and the life-of-mine at about 30 years.
Sumbula also told the Angola Business Forum that, in the meantime, Endiama would slightly reduce its diamond production to boost its revenues. “When the company produced eight-million carats, [revenues] were $1 200-million, but, in 2016, with a production of nine-million carats, revenues declined to $1 070-million,” he reported. He added that his company was in talks with other major global diamond producers, particularly Alrosa, De Beers and Rio Tinto, to agree to small production cuts in order to boost diamond prices. “Our intention is to work towards greater revenues as a result of a reduction in production.”
Angolan Geology and Mines Minister Francisco Queiroz used the Mining Indaba to promote his country’s mining investment opportunities. Angola had a stand at the conference, showcasing the Angolan government’s strategy for the mining sector, the development of the National Geology Plan (known by its Portuguese acronym of Planageo) and operations by private-sector companies in Angolan mining. The latest data obtained by Planageo was made available to inform the international mining industry of the opportunities in the country.
A few days earlier, in the Angolan capital of Luanda, Queiroz had given the assurance that Planageo had guaranteed financing, noting that it was the main strategic instrument for government in the mining sector. The implementation of the plan had suffered from some delays. Despite these, “we are within what is reasonable [in terms of] compliance with the plan”, he said. Up to now, data from 19 of the 22 blocks identified by the plan has been processed and interpreted. This comprised 85% of the areas to be surveyed by the Planageo operation.
Preliminary aerogeophysical survey data has identified 1 623 targets, of which 1 526 are magnetic and 27 radiometric.