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De Beers notes improvement in diamond production

Re-opens three mines in Botswana

April 16, 2009

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Gaborone, Botswana--Diamond mining resumed this week at three out of four mines in Botswana operated by Debswana, the joint venture between the government of Botswana and De Beers.

According to a release issued by De Beers, trucks began rolling again and some 5,800 people returned to work at the Jwaneng, Orapa and Letlhakane mines following a 50-day pause in production.

Production had been suspended due to the global economic crisis, which brought about a sharp drop in the demand for rough diamonds.

The economic downturn impacted all stages of the diamond pipeline, right down to the mines, but, in the release issued this week, De Beers Botswana Chairman Stephen Lussier noted improvement in the market.

"As retailers have lowered their level of purchasing, it has taken time for inventory to work through the pipeline, leading to a disproportionately negative knock-on affect on production. We have begun to see signs of improvement in the market and expect this to continue as the year unfolds," he said.

During the pause in production, Debswana employees remained on full pay and Debswana performed maintenance on the mines.

"The first quarter of 2009 was a challenging time. The men and women that work for Debswana responded swiftly to the global downturn, enabling the company to withstand the economic crisis," Lussier said. "This accomplishment is all the more meaningful when considering the fact that, in the long term, with future growth in emerging markets, demand is likely to significantly outpace what is forecast to be lower levels of diamond supply for many years to come."

While three mines re-opened this week, production at Debswana's fourth and smallest mine, Damtshaa, and at the Orapa No. 2 Plant, is suspended until the end of 2009, according to the release.
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Business | Economic Crisis | Economic Issues | National Economy

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