Brian Benza
13 November 2009
The expansion of the largest diamond mine in the world by value, Jwaneng, will cost P3.5 billion ($500 million).
Debswana is trying to prolong the mine's lifespan by a further seven years by means of this project that began last month.
Styled Cut 8, the critical stay-in-business project is one of a number by which Debswana aims to sustain its revenue streams and ensure the continuity of shareholder returns into the latter part of the next decade.
In response to Business Week questions, Group's Public and Corporate Affairs Manager, Esther Kanaimba-Senai, said although the company had just come out of a dry patch due to the global recession, the Cut 8 project was critical to the life of Jwaneng Mine.
"Without it, mining at Jwaneng would be severely curtailed post 2017 as ore from Cuts 6 & 7 would almost be depleted," Kanaimba-Senai said. "Diamonds from Cut 8 will only come on stream in 2017. The project involves planning, preparation and implementation of activities associated with the next cut of waste to further expose the existing ore body.
"Cut-8 will extend the life of the mine by 7 years from 2017 to 2024 and optimise long-term distribution to shareholders while contributing to the development of Botswana.Currently, Jwaneng is mining to a depth of 330 metres and this is expected to reach 650 metres by 2017."
Earthworks at the site commenced in late March 2009 for the refurbishment of an existing construction camp. Construction activities began last month and are expected to last until November 2011. It is also expected that contractor numbers will peak in the fourth quarter of 2010, reaching 1,000 or slightly more.
The mining of waste material is expected to commence in January 2010 and will be completed by 2017.
The Cut 8 project involves the widening and deepening of the existing Jwaneng pit as a short-term alternative to going underground. The project will strip 713 million tonnes of waste in order to expose 75 million tonnes of ore and 95 million carats. This will take place at the rate of 122 million tonnes of waste per year. In widening, the project will result in mining out areas where current mining and plant infrastructure are situated.
The expansion of the Jwaneng pit is one of the few projects approved by the Debswana board this year when it announced a slew of cost-cutting measures that included the temporary suspension of production at all Debswana mines and the closure of Orapa No.2 Plant and Damtshaa Mine.
Funding for the project that will "catapult Jwaneng Mine towards super-pit status and treble the number of vehicles currently used at the mine" will come from Debswana, Kanaimba-Senai said.
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