10
FEATURE LETŠENG DIAMONDS
| Date post: | 16-Mar-2016 |
| Category: |
Documents |
| Upload: | tnt-multimedia-limited |
| View: | 214 times |
| Download: | 0 times |
FEATUR
E
L E T Š E N G D I A M O N D S
58 www.southafricamag.com
diamond mining company Letšeng Diamonds is nestled high in the breathtaking Maluti Mountains of the Kingdom of Lesotho.By Ian Armitage
d i a m o n d i n t h e
D I A M O N D I N T H E
Drilling operation in the open pit
58 www.southafricamag.com
Letšeng Diamonds is nestled high in the breathtaking Maluti Mountains of the Kingdom of Lesotho.By Ian Armitage
D I A M O N D
roughroughdiamond mining company
roughdiamond mining company Letšeng Diamonds
roughLetšeng Diamonds is nestled
rough is nestled
D I A M O N D
roughD I A M O N D I N T H EroughI N T H E
Drilling operation in the open pit
d iamond mining company Letšeng Diamonds is nestled high in the breathtaking Maluti
Mountains of the Kingdom of Lesotho, the highest diamond mine in the world at over 3,000 metres above sea level,
Letšeng’s story began in 1995, when the previous General Manager, Keith Whitelock, commenced a process to re-open the Letšeng mine after De Beers had closed it in the early 1980s.
In 1999, the mining lease for the Letšeng mine was acquired, during which time the South African company, JCI Gold, was the majority shareholder. It took a further fi ve years for the mine to come into commercial production.
In 2004 the mine had a single processing plant with the operation producing around 35,000 carats a year. Then, in 2006, Gem Diamonds Limited acquired JCI’s stake and became the 70 percent shareholder, in partnership with the Government of Lesotho, which holds the remaining 30 percent. In 2007, Mazvi Maharasoa joined Letšeng as the Company’s Resident Director and was appointed as CEO of Letšeng Diamonds in November 2009.
The Letšeng Mine is currently the seventh largest processing kimberlite mine in the world, with an estimated 35 year mine life from its two primary vertical kimberlite pipes of the 33 known kimberlite pipes within the Kingdom of Lesotho.
“Processing kimberlite ore and liberating the diamonds is Letšeng’s core business, and upon taking control of Letšeng, the fi rst order of business for Gem Diamonds was to approve an expansion plan, which saw the construction of a second processing plant, bringing the processing capacity of the mine to circa seven million tonnes of
ore, producing circa 100,000 carats per annum,” says Maharasoa.
Now in 2012, plans are underway to further increase the annual treatment capacity of the Letšeng mine to around 10 million tonnes per annum, with a carat output rising to around 200,000 carats per annum.
Outlining the new expansion project at Letšeng, known as Project Kholo, Maharasoa adds, “Our business strategy is growth. The mine fundamentally needs to continue to drive costs down, improve effi ciencies and maximise revenue. The Letseng expansion project was approved in November 2011 by both the Letšeng and the Gem Diamonds Boards. Project Kholo will commence in January 2012 and when this expansion is complete, the Letšeng mine will rank amongst the top four largest kimberlite diamond mines in the world.”
“The total project capital expenditure for Project Kholo is estimated at US$280 million,” says Stephen Gould, the Chief Operations Offi cer of Letšeng Diamonds. “The expansion project at the Letšeng mine is a major step forward. The number of carats of diamonds which we produce will effectively be doubled,” he adds. “Through Project Kholo, we will be improving the recovered grade through the increased liberation of diamonds from the kimberlite ore, while we introduce new technology to reduce diamond damage and unit costs.”
The requirements of project Kholo go far beyond just increasing the capacity of the treatment plants. The current open pit mine will increase in depth from 150 to 500 metres. In order to expose suffi cient ore for the plants, the waste mining activity has to increase from moving 15 million tonnes of waste per annum to in excess of 60 million tonnes
Letšeng Diamonds FEATURE
59www.southafricamag.com
d iamond mining company Letšeng Diamonds is nestled high in the breathtaking Maluti
Mountains of the Kingdom of Lesotho, the highest diamond mine in the world at over 3,000 metres above sea level,
Letšeng’s story began in 1995, when the previous General Manager, Keith Whitelock, commenced a process to re-open the Letšeng mine after De Beers had closed it in the early 1980s.
In 1999, the mining lease for the Letšeng mine was acquired, during which time the South African company, JCI Gold, was the majority shareholder. It took a further fi ve years for the mine to come into commercial production.
In 2004 the mine had a single processing plant with the operation producing around 35,000 carats a year. Then, in 2006, Gem Diamonds Limited acquired JCI’s stake and became the 70 percent shareholder, in partnership with the Government of Lesotho, which holds the remaining 30 percent. In 2007, Mazvi Maharasoa joined Letšeng as the Company’s Resident Director and was appointed as CEO of Letšeng Diamonds in November 2009.
The Letšeng Mine is currently the seventh largest processing kimberlite mine in the world, with an estimated 35 year mine life from its two primary vertical kimberlite pipes of the 33 known kimberlite pipes within the Kingdom of Lesotho.
“Processing kimberlite ore and liberating the diamonds is Letšeng’s core business, and upon taking control of Letšeng, the fi rst order of business for Gem Diamonds was to approve an expansion plan, which saw the construction of a second processing plant, bringing the processing capacity of the mine to circa seven million tonnes of
ore, producing circa 100,000 carats per annum,” says Maharasoa.
Now in 2012, plans are underway to further increase the annual treatment capacity of the Letšeng mine to around 10 million tonnes per annum, with a carat output rising to around 200,000 carats per annum.
Outlining the new expansion project at Letšeng, known as Project Kholo, Maharasoa adds, “Our business strategy is growth. The mine fundamentally needs to continue to drive costs down, improve effi ciencies and maximise revenue. The Letseng expansion project was approved in November 2011 by both the Letšeng and the Gem Diamonds Boards. Project Kholo will commence in January 2012 and when this expansion is complete, the Letšeng mine will rank amongst the top four largest kimberlite diamond mines in the world.”
“The total project capital expenditure for Project Kholo is estimated at US$280 million,” says Stephen Gould, the Chief Operations Offi cer of Letšeng Diamonds. “The expansion project at the Letšeng mine is a major step forward. The number of carats of diamonds which we produce will effectively be doubled,” he adds. “Through Project Kholo, we will be improving the recovered grade through the increased liberation of diamonds from the kimberlite ore, while we introduce new technology to reduce diamond damage and unit costs.”
The requirements of project Kholo go far beyond just increasing the capacity of the treatment plants. The current open pit mine will increase in depth from 150 to 500 metres. In order to expose suffi cient ore for the plants, the waste mining activity has to increase from moving 15 million tonnes of waste per annum to in excess of 60 million tonnes
Letšeng Diamonds FEATURE
59www.southafricamag.com
60 www.southafricamag.com
per annum. “This will further increase job opportunities at the mine,” says Maharasoa. “In order to improve the effi ciency of this large earthmoving operation, the size of the equipment employed will be increased by a factor of three. A logistical challenge will be to get this large equipment up the mountain and the project will also include building the required earthmoving workshop needed for maintaining this equipment.”
The challenge of providing the increased power required is being carefully managed, and currently the plan is to increase the capacity of the current power line, Maharasoa says. However, this will stretch power supply to its limit, and in order to cater for a possible underground mine in the future, other options such as a second
60 www.southafricamag.com
Letšeng Diamonds FEATURE
line and the possibility of using wind generated power are being looked into. “The additional provision of fresh water, accommodation and other services are also being addressed in the planning of project Kholo,” Maharasoa adds.
In order to ensure that the implementation of project Kholo does not negatively affect the life of mine, a programme of geological drilling has already commenced to map the kimberlite deposits to greater depths in order to better understand the diamond resource deposits.
“At some point in the future, it will become more economically feasible to mine these deposits from underground, and a pre-feasibility study has been commissioned to establish this depth and to examine possible mining methods,” says Gould.
“I am extremely excited for the future,” adds Maharasoa. “There are a great many factors for contemplation and great potential for growth and development at Letšeng.
Diamondiferous ore being loaded from the open pit
Snow clad Maluti mountains behind the tailings conveyor belt
Alliance is a Lesotho based insurance company, whose services are focused on the provision of: Short-Term Commercial and Personal Insurance and Life Assurance Products.
Alliance Insurance Company is proud to have been Alliance Insurance Company is proud to have been Letseng Diamond Mines’ Short Term Insurance Partner from the very beginning of the mining operations. Alliance is heavily involved in Lesotho as a Short Term Underwriter in Mining, Engineering, Construction, Contractors Guarantees and Professional Indemnity covers.
Our Life business unit offers market leading Funeral Products, Group Life and Our Life business unit offers market leading Funeral Products, Group Life and Employees Benefits Schemes. Our Re Basotho Savings Plan is a one of a kind in Lesotho.
Our products are geared towards reinvestment in the community; to ensure that everybody benefits from their association with us.
We strive to continually deliver unsurpassed service, as well as innovative and value-added insurance solutions and products.
Contact us or see our website : www.alliance.co.ls for more information on the insurance we can offer you.
Mok'haphek'ha Lazaro [Mr]Executive Director - Short-Term
Alliance House, 4 Bowker Road, Maseru, LesothoP.O. Box 01118, Maseru West, 105, Lesotho
Landline: (+266) 2231 2357 Cellular: (+266) 6211 6969Direct : (+266) 2232 6027 Cellular: (+27)7 9885 1314 Email: [email protected] Fax: (+266) 2231 0313Email: [email protected] Fax: (+266) 2231 0313
62 www.southafricamag.com
“Strategically, Letšeng is looking at ways to increase the business potential in terms of developing in-country diamond cutting and polishing facilities, known as benefi ciation.”
The diamonds produced at Letšeng sell for the highest price per carat of any kimberlite mine, with a grade of less than two carats per hundred tonnes. Letšeng’s sales and marketing strategy seeks to maximise revenue, through additional margins further down the diamond value chain.
“Although the Letšeng mine is characterised by a low-grade ore body, producing less than two carats per 100 tonnes of ore mined, it is also renowned for producing some of the world’s largest, most exceptional
62 www.southafricamag.com
EXECuTIVE PROFILE: MAZVIVAMBA (MAZVI) MAHARASOA, CEO, LETŠENG DIAMONDS
Mazvi holds a Masters degree in International and Commercial Law. She joined Letšeng Diamonds as the Resident Director in 2007 from the Central Bank of Lesotho, where she was the Acting-Secretary to the Board, and simultaneously served on the Board of Letšeng Diamonds as a Government appointed Non-executive Director. Prior to working as the Acting-Secretary to the Board, Mazvi was the Principal Legal Advisor to the Ministry of Natural Resources, where she was instrumental in the negotiations of mining leases and the drafting of the current Mines and Minerals Act (2005). Mazvi was appointed Letšeng Diamond’s Chief Executive Offi cer in November 2009.
Letšeng Diamonds FEATURE
64 www.southafricamag.com
diamonds,” says Gould. “The Mountain Kingdom’s gems are amongst the very best in the world and approximately 35 percent of the world’s supply of diamonds larger than 10.8 carats in size are produced at Letšeng with around 90 percent of the diamonds recovered at the Letšeng Mine being gem quality.
“Over the years, the Letšeng Mine has recovered four of the world’s 20 largest rough diamonds such as the 603 carat Lesotho Promise, the 493 carat Letšeng Legacy, the 478 carat Light of Letšeng and the 550 carat Letšeng Star,” he adds. “The expansion project will enable us to increase the volume of this high value production even further, thereby allowing us to
invest in appropriate cutting and polishing technologies in order to participate downstream and maximise revenue potentials.”
Letšeng’s diamonds are extremely valuable and so the fi rm is are looking at all downstream options in order to capture additional margin beyond the mine gate, Gould says. “We are becoming increasingly successful in selling rough and polished diamonds, with good margins being realised.
“A cutting and polishing facility will be built in Maseru, Lesotho. Naturally this will create jobs locally and would be positive for Lesotho. Mining is an extractive industry, however, it is a fi nite resource, so you
64 www.southafricamag.com
Letšeng Diamonds FEATURE
Mining is an
extractive industry, however,
it is a finite resource
The fi rst plant no 1 taken from no 2 plant against the Maluti
mountain backdrop
G4S is the world's leading security solutions group, which specialises in outsourcing of business processes in sectors where in sectors where security and safety risks are considered a strategic threat.G4S Lesotho consists of three divisions:1. G4S Secure Solutions• Integrated Services • Risk Management• Integrated Services • Risk Management• Secure Solutions • Guarding Services
2. G4S Cash Solutions• Cash and Valuables Transportation• Cash Processing • ATM Outsourcing• Special Services • CASH360 Retail Services
3. G4S Security Systems• Alarm Systems • Armed Monitoring/Response• Alarm Systems • Armed Monitoring/Response• CCTV Cameras • Electric Fence
Tel: +266 22247200
Fax: +266 2247202
www.g4s.comwww.aon.com
Aon are proud indeed to have been the preferred Brokers to Letseng Diamond Mine from the
beginning. We continue to provide quality world class Risk Management Solutions to the entire Diamond
Mining industry in Lesotho tapping into Aon worldwide resources to ensure global solutions are
delivered locally.
need to have as many economic linkages with the community, and national economy as possible – it is just good corporate practice.
“From cutting and polishing you can have spin-off industries such as the jewellery manufacturing industry, which can create SME enterprises and additional employment,” he continues. “That really is our objective. We want to put the seeds down for economic development from the mining industry.”
According to Maharasoa, the global mid-to-long-term outlook for the diamond industry is overall very positive. “Given the industry consensus around the extremely positive supply/demand dynamics for high-end diamonds, Project Kholo is an investment which signals confi dence in future growth for Letšeng,” she concludes. END
South Africa Magazine, Suite 9 and 10, The Royal, Bank Plain, Norwich, Norfolk, UK. NR2 4SF
TNT Magazine, Unit 209, 16 Brune Place, London E1 7NJ
ENQUIRIESTelephone: 0044 (0)1603 343267Fax: 0044 (0)1603 283602 [email protected]
SUBSCRIPTIONS Call: 00441603 [email protected]
www.southafricamag.com
LCCI Business ParkCnr orpen & Princess Margaret roadsMaseru 100, Lesotho
Postal address: PO Box 12508Maseru 100, Lesotho
Tel: +266 2231 6612Fax: +266 2231 0546
www.letsengdiamonds.co.ls
