Botswana Diamonds Ltd seals deal to mine in Zimbabwe

  • BOD to mine at Marange diamonds
  • Marange has history of ‘Blood diamonds’

Gazette Reporter

Botswana Diamonds, (BOD), dual listed on the Australian Stock Exchange and Botswana Stock Exchange (BSE) BSE recently announced that it has concluded an agreement with Vast Resources plc (Vast) for the development of their concessions in the prolific Marange Diamond Fields (MDF) of eastern Zimbabwe, Chairman John Teeling, announced.
According to the company, a separate agreement will cover the joint development of diamond properties outside of the MDF, which will be a straightforward 50/50 joint venture, though the initial focus of the joint work is on the MDF. Vast has exclusive access to key diamond concessions (the ‘Heritage Concession’) in the MDF of the Chiadzwa region of eastern Zimbabwe, through an agreement with a community organisation. BOD will perform due diligence on the area to conclude a joint venture agreement for diamond exploration, mining and marketing. The 15km² Heritage Concession neighbours Vast’s historic MDF claim, and seems to be a geological extension of that system.
To develop diamond properties in Zimbabwe, BOD and Vast signed a MoU in May 2018, which has matured into an agreement on the MDF, including, a Special Purpose Vehicle (SPV) between BOD and Vast to develop diamond resources in the MDF. Further, initial shareholdings will be BOD – 13.33 percent and Vast – 86.67 percent.
Vast will contribute up to US$1 million as initial funding. If any additional funds are required, this will be via an equity raise. BOD and Vast may contribute to any future equity raise on a pro rata basis. If either party does not take up its allocation, the other may.
John Teeling, Chairman, commented, “I am delighted that we have concluded terms with Vast on developing their concessions within the prolific Marange Diamond Fields. We look forward to working with them to realise the full potential of this prospective area and others, as they emerge, with Zimbabwe opening up further for business. Work on the initial due diligence is far advanced and we look forward to providing further updates to the market in due course.”
The discovery of massive diamond deposits in Zimbabwe has led to hundreds of media reports exploring the abuse of human rights and grand scale corruption. Initially De Beers had full exploration rights to search for minerals in the Marange communal area in eastern Zimbabwe. According to Pambaruka News Agency, their exploration certificates expired on 28 March 2006, and De Beers did not renew them.
The agency said a United Kingdom-registered company African Consolidated Resources (ACR) subsequently registered exploration claims over the Marange diamond fields, giving them exclusive rights to explore and search for diamonds and other precious stones in Marange district. In June 2006, having discovered diamonds, Pambaruka said they declared the find, whereupon the government evicted them, seizing 129,400 carats ACR had extracted. They then reportedly opened the fields to anyone wishing to look for diamonds. ‘It was estimated that between 15,000 and 20,000 illegal artisanal miners were working the land and illegally selling their diamond finds to dealers outside the country.’
In 2006 the Zimbabwe government launched a nationwide police operation code-named Chikorokoza Chapera (End to Illegal Panning) aimed at stopping illegal mining. ‘The operation was marked by human rights abuses, corruption, extortion and smuggling. Further In July 2009 the Ministry of Mines accepted expressions of interest from companies willing to enter into joint ventures to mine in Marange under the auspices of the Zimbabwe Mining Development Corporation. This resulted in the incorporation of two new distinct companies in which ZMDC [through Marange Resources”> had 50 percent shares: Mbada Diamonds and Canadile Miners Private Limited.
The news agency said Transparent procedures were not followed.
On 4 November 2010 five officials from ZMDC and a director from Canadile were arrested over an alleged US$2-billion fraud. Canadile’s operations were suspended, its equipment confiscated and its directors barred from entering the country. The ZMDC, through Marange Resources, assumed total control of the diamond claims held by Canadile.
The government then granted licenses to Sino-Zimbabwe, a joint commercial entity between the Chinese government and Zimbabwe, Anjin, a Chinese company and Pure Diamonds, a Lebanese firm.
Every day millions of dollars’ worth of diamonds leave Zimbabwe from the world’s richest diamond field. But none of that money reaches the country’s desperate poor.
Militarised diamond mining and trading at Marange has resulted in loss of life, human rights abuses, corrupt practices and the enrichment of a privileged and powerful political elite.