The De Beers Group and the Botswana Government have reached an ‘agreement in principle’ for a new mining contract, bringing an end to months of tense negotiations.
State-owned business Okavango Diamond Company (ODC) will receive 30 per cent of production from Debswana, the joint venture between De Beers and the government.
This will increase progressively to 50 per cent over the duration of a 10-year agreement. ODC currently receives 25 per cent of production.
The sales agreement will run until 2033, while the 25-year mining licence extension will conclude in 2054. The terms of the current expired sales agreement will remain in place while De Beers and Botswana implement the new deal.
De Beers CEO Al Cook: “For De Beers it is a privilege to renew our half-century partnership with the people of Botswana. It is a partnership that is highly regarded around the world for the enduring role it has played in creating economic development and growth.”
“Our transformative agreement reflects the aspirations of the country, secures the future of our Debswana joint venture, and reaffirms De Beers’ leadership position for the long-term.”
The new agreement also includes the creation of a ‘Diamonds for Development’ fund, with De Beers expected to invest approximately $US750 million ($AU1.12 billion) over the coming decade.
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