Debswana, Botswana’s largest diamond miner, plans to raise $1 billion for underground expansion at Jwaneng mine, extending operations to 2054. Despite reducing production due to a declining market, the company seeks an international credit rating and anticipates increased capital expenditure in the coming years. Minister Bogolo Joy Kenewendo expresses optimism about market recovery beginning in 2026.
Botswana’s prominent diamond mining company, Debswana, is looking to raise $1 billion from global capital markets to support a substantial expansion at its flagship Jwaneng mine. Managing Director Andrew Motsomi announced this plan during a mining conference in Gaborone on June 17. The funds will primarily back an underground mining project as the current open pit operations are expected to conclude by 2034. Transitioning to underground mining offers a way to keep Jwaneng operational until 2054.
Despite challenges in the diamond market, Debswana is pushing ahead with its ambitious expansion plans. Production has faced cuts, with a reported decrease of 27% in 2024 and another 16% reduction announced, bringing the total to about 15 million carats for 2025. Motsomi stressed that the company is also pursuing an international credit rating. This move is crucial to enable Debswana to tap into global capital markets for financing.
Motsomi elaborated on the financial struggles facing Debswana, stating, “With revenues declining, the company is facing escalating capital requirements.” He detailed that capital expenditures are projected to rise from an average of BWP 5 billion, approximately $373 million, annually over the last five years to around BWP 8 billion per year in the coming five years.
Minerals and Energy Minister Bogolo Joy Kenewendo voiced optimism regarding a revival in the diamond market, hoping for recovery starting in 2026. “Since January, we have begun to see positive signs in the market. While we are not yet where we want to be, the upward trend is encouraging and gives us hope for a more robust recovery in the latter half of the year,” she commented.
Founded in 1969, Debswana operates four mines, including Jwaneng, Orapa, Letlhakane, and Damtshaa. The company stands out as one of the leading diamond producers in the world, both in terms of volume and value, with its headquarters situated in Gaborone.
In summary, Debswana is seeking to raise $1 billion to fund an underground expansion at its Jwaneng mine, aiming to extend its operational life. Despite ongoing challenges in the diamond market, the firm remains committed to its growth strategy while managing declining revenues. Future capital expenditure projections indicate rising investment needs, suggesting a determined effort to adapt and thrive even during market fluctuations. Government officials remain hopeful for a market recovery by 2026.
Original Source: www.intellinews.com
