The company, which is 85 per cent owned by mining giant Anglo American and 15 per cent by the government of Botswana, will dig beneath its existing open-pit Venetia Mine, extending the life of the complex up until 2042.
The company said the development and build phase of the project would create 1,000 jobs and that the mine, due to enter production in 2020, would yield around 96m carats during its lifetime. The project is being carried out by De Beers’ South African operation, De Beers Consolidated Mines.
It has been a difficult year for the South African mining industry, with widespread labour unrest disrupting operations and denting profits. Key mining industry players Impala Platinum and De Beer’s parent company, Anglo American, have produced disappointing results this week. Overall mining output in South Africa declined for the fourth month in a row in December, falling 7.5 per cent year on year.
Added to this there has been uncertainty surrounding the ruling ANC’s plans for increased taxation of the mining industry, though calls for nationalisation were quashed at the party’s conference in December.
With the mining industry in general promising to become more parsimonious with its investment, some have suggested that this combination of factors would serve to deter new capital spending in South Africa mines. But there are no such worries when it comes to De Beers, it seems.
Barend Petersen, chairman of De Beers Consolidated Mines, said in a statement: “We see this significant capital investment as another concrete example of our commitment to the South African mining industry [which] remains an integral part of the aspiration to build a more prosperous and equitable South Africa.”