De Beers’ Confident Talks Will Deliver a Botswana Diamond Deal

from Noble Magazine February-March Issue

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Though some of the negotiations to agree new terms were complex, De Beers has confidence of maintain its long time partnership with Botswana.

The president of the republic of Botswana, His Excellency Dr Mokgweetsi Eric Keabetswe Masisi on Sunday 12 of February 2023 had threatened to walk away from talks on the extension of De Beers’ mining rights in the country unless Botswana got a larger share of revenues.

“The company was ‘confident that our successful partnership will continue’ and arrangements must make economic and strategic sense for both parties,” said the De Beers’ Vice President-Corporate Affairs (Global Sightholder Sales) Otsile Mabeo.

He added that the De Beers’ Anglo American is in talks with the Botswana government to extend mining rights that expire in 2029, as well as a 2011 diamond sales agreement that expires in June this year.

“It’s important to note that our negotiations span more than just the sales agreement, they also include the future mining rights for Debswana, which are more complex and require more time to land on the finer details,” expressed Mabeo.

Under the current deal, Debswana - a 54 year-old joint venture between De Beers and the Botswana governmentsells 75% of its output to De Beers, while 25% goes to the state-owned Okavango Diamond Company. Botswana supplies 70% of De Beers’ rough diamonds. Last year, Debswana’s diamond sales hit a record $4.588-billion, compared to $3.466-billion in 2021. Diamond sales, almost entirely from Debswana, account for two-thirds of Botswana’s foreign currency receipts and a fifth of its gross domestic product.

The Botswana government officials did not immediately comment however as time went on beginning of February 2023 Botswana’s Minister of Minerals and Energy (MaE), Lefoko Moagi shared that with hope a deal would be reached before the June deadline.

“A lot has been done, and what is left is material, but it is not insurmountable, it is in our best interests that we resolve that by the deadline,” Minister of Minerals and Energy, Moagi said on the side-lines of last week’s Cape Town Indaba Mining Conference.

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