Gov’t to buy shares in Lucara

  • De Beers regrets selling Karowe Diamond Mine
  • More exceptional stones expected at Lucara
  • Masisi negotiates for gov’t to invest in Lucara


President Mokgweetsi Masisi has opened negotiations with gem diamond producer, Lucara Diamond Corporation for government buy and own shares in the company.

Last Friday, Masisi arrived back from the United States of America (USA) where he had attended the JCK Jewellers Trade Show in Las Vegas. JCK Las Vegas is the leading jewellery event in North America open to all jewellery professionals. Each year, the industry gathers where the latest awe-inspiring domestic and international designers and most sought after trends are showcased. It is there that Masisi met with founder and Chief Executive Officer (CEO) of Lucara Eira Thomas. “I have proposed for Lucara to allow government to invest in the company,” he said, adding that he will discuss with his cabinet and relevant authorities to agree on investing in Lucara. According to Masisi, government realised that Lucara, which operates Karowe Diamond Mine in Botswana has been consistently unearthing large high quality diamonds, which continue to fetch millions. “As a country we could benefit from such value,” he said. However, Masisi did not reveal how much stake is government interested in buying; neither did he reveal how soon government will effect the transaction.

Interestingly, government, through its 15 percent stake in De Beers, used to have an indirect stake in Karowe Diamond Mine, previously named AK6 Mine.

The retrieval of various exceptional stones at Karowe pains both Government and De Beers as the global mining giant sold the AK6 to Lucara years back for a bargain P490 million. According to Masisi, Lucara has made five times more money than they used to buy Karowe Diamond Mine.

In a previous engagement, De Beers Executive Vice President Paul Rowley said; as with any business, they at De Beers look back and say, “ maybe we should not have but at the time it was a good decision and we do not have regrets, we are actually delighted at the success of AK6.”

According to Rowley, Karowe (AK6) in comparison to the 7 hectare pit at Orapa and the very rich Jwaneng mine was considered too small to mine by De Beers.

Small amounts of work were undertaken by Debswana between 1986 and 1998 with no conclusive results. Lucara felt there was value to be extracted from Karowe and went to do further prospecting. The Mine has produced many gem quality type 2A diamonds of over 200 carats since production.

Lucara acquired a 70 percent stake in the AK6 project from De Beers Prospecting Botswana in Dec 2009 and Lucara acquired African Diamonds in Dec 2010 to hold 100 percent of the asset. The mine was constructed between 2010 and 2012 and commissioning and first diamond sales started in 2012. The Plant was upgraded in 2014 to a “Large Diamond Recovery Circuit”.
In addition to the second biggest diamond to be ever found in the world in November 2015 (1 111 carat Lesedi La Rona), Lucara retrieved two other exceptional white diamonds at 813 carats and 374 carats at Karowe Mine, all in one magical week.

In April this year Lucara announced that a 1,758 carat diamond was unearthed from Karowe diamond mine and is the biggest diamond to be recovered from the operation to-date weighing in at 352 grams and measuring 83mm by 62mm by 46mm.

It has been classified as “near gem of variable quality” and comprises domains of high-quality white gem.

Since 2015, 12 diamonds bigger than 300 carats have been discovered at Karowe. Two of the diamonds have exceeded 1,000 carats including this latest find. More than half of the 12 diamonds were categorized as gem quality and 11 have been sold, bringing in more than US$158 million (Over P1.5 billion) in revenue.

“Karowe has now produced two diamonds greater than 1,000 carats in just four years, affirming the coarse nature of the resource and the likelihood of recovering additional large high-quality diamonds in the future, particularly as we mine deeper in the ore body and gain access to the geologically favourable EM/PK(S) unit – the source of both of our record breaking plus-1,000 carat diamonds,” Lucara chief executive officer Eira Thomas said.