De Beers’ 2018 Di­a­mond Pro­duc­tion +6% To 35.29mct

Solitaire - - SPECTRUM -

De Beers said rough di­a­mond pro­duc­tion for the fourth quar­ter of 2018 in­creased by 12% to 9.1 mil­lion carats. This brought De Beers’ to­tal di­a­mond pro­duc­tion for 2018 to 35.29 mil­lion carats, a year-on-year in­crease of 6%, due to a planned pro­duc­tion in­crease at the Orapa mine, although this was in the lower half of the pro­duc­tion guid­ance range of 35 to 36 mil­lion carats, it noted.

In Botswana (Deb­swana), Q4 pro­duc­tion in­creased by 15% to 6.3 mil­lion carats. De Beers’ full year di­a­mond out­put in Botswana grew 6% to 24.1 mil­lion carats. Orapa’s Q4 pro­duc­tion in­creased by 20% to 3.6 mil­lion carats driven by planned favourable grade and higher plant util­i­sa­tion. Jwa­neng’s pro­duc­tion in­creased by 9% fol­low­ing an in­crease in tonnes treated, De Beers said.

The com­pany’s fourth quar­ter di­a­mond pro­duc­tion in Namibia (Namdeb Hold­ings) in­creased by 3% to 0.5 mil­lion carats, driven by the Mafuta crawler ves­sel at Deb­ma­rine Namibia spend­ing fewer days in port. This was partly off­set by the land op­er­a­tions fol­low­ing the tran­si­tion of El­iz­a­beth Bay to care and main­te­nance, the miner said. De Beers’ an­nual di­a­mond pro­duc­tion in Namibia rose by 11% to 2.0 mil­lion carats.

The min­ing ma­jor’s South African (De Beers Con­sol­i­dated Mines) di­a­mond pro­duc­tion in­creased by 7% to 1.2 mil­lion carats in the fourth quar­ter as a re­sult of planned higher grade ore at Vene­tia. How­ever, its South African di­a­mond out­put reg­is­tered a 10% drop to 4.6 mil­lion carats for the full year 2018.

De Beers’ Canada pro­duc­tion in­creased by 5% to 1.0 mil­lion carats in the fourth quar­ter due to higher grades at Vic­tor as it reaches the end of its life. This was par­tially off­set by planned lower grades at Gah­cho Kué. The miner’s Cana­dian di­a­mond out­put shot up 19% on a year-on-year ba­sis to 4.47 mil­lion carats.

De Beers said rough di­a­mond sales vol­umes in the fourth quar­ter to­talled 9.9 mil­lion carats (9.3 mil­lion carats on a con­sol­i­dated ba­sis) from three sales cy­cles, com­pared with 8.2 mil­lion carats (7.5 mil­lion carats on a con­sol­i­dated ba­sis) from the same num­ber of sales cy­cles dur­ing the equiv­a­lent pe­riod in 2017. Fourth quar­ter rough sales revenues in­creased year-on-year as the re-phased al­lo­ca­tions of some lower value rough di­a­monds from Sight 7 (in Septem­ber) were re­alised in Sights 9 and 10.

For the full year, rough di­a­mond sales vol­umes were 4% lower at 33.7 mil­lion carats (31.7 mil­lion carats on a con­sol­i­dated ba­sis) com­pared with 35.1 mil­lion carats (33.1 mil­lion carats on a con­sol­i­dated ba­sis) in 2017. The 2018 sales vol­umes were also lower than pro­duc­tion, driven by lower de­mand for lower value rough di­a­monds in the sec­ond half of 2018.

The con­sol­i­dated av­er­age re­alised price of $171/carat was 6% higher (2017: $162/carat), due to a lower pro­por­tion of lower value rough di­a­monds sold in 2018.

De Beers’ 2019 pro­duc­tion guid­ance is 31 to 33 mil­lion carats, sub­ject to trad­ing con­di­tions. The lower pro­duc­tion is driven by the process of ex­it­ing from the Vene­tia open pit with the un­der­ground be­com­ing the prin­ci­pal source of ore from 2023. As­so­ci­ated with this, an in­creased pro­por­tion of pro­duc­tion in 2019 is ex­pected to come from De Beers’ joint ven­ture part­ners, a pro­por­tion of which gen­er­ates a trad­ing mar­gin, which is lower than the min­ing mar­gin gen­er­ated from own mined pro­duc­tion.

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