DE Beers Consolidated Mines.
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PRODUCTION REPORT FOR THE SECOND QUARTER OF 2019
18 Jul 2019
De Beers (1) Q2 Q2 Q2 2019 Q1 Q2 H1 H1 H1 (000 carets) 2019 2018 vs. 2019 2019 2019 2018 2019 Q2 2018 vs. vs. Q1 H1 2019 2018 Botswana 5,718 6,279 (9)% 5,950 (4)% 11,668 12,087 (3)% (Debswana) Namibia 335 515 (35)% 483 (31)% 818 1,044 (22)% (Namdeb Holdings South Africa 571 1,018 (44)% 382 49% 953 2,111 (55)% (DBCM) Canada 1,075 1,185 (9)% 1,037 4% 2,112 2,253 (6)% Total carats 7,699 8,997 (14)% 7,852 (2)% 15,551 17,495 (11)% recovered
Rough diamond production decreased by 14 per cent to 7.7 million carats driven by reductions in Botswana (Debswana) and South Africa (DBCM). Production guidance has been revised downwards to ~31 million carats, in response to weaker trading conditions.
Botswana (Debswana) production decreased by nine per cent to 5.7 million carats. This was driven by a decrease at Orapa2 of 23 per cent to 2.5 million carats following a planned plant shut down brought forward from H2 2019, which impacted production in late Q1 and early Q2. Production at Jwaneng increased by seven per cent to 3.2 million carats, driven by an increase in tonnes treated.
Namibia (Namdeb Holdings) production decreased by 35 per cent to 0.3 million carats, driven by Elizabeth Bay transitioning onto care and maintenance in Q4 2018 and planned maintenance for the Mafuta crawler vessel.
South Africa (DBCM) production decreased by 44 per cent to 0.6 million carats due to lower mined volumes at Venetia as it approaches the transition from open pit to underground. In addition, Voorspoed production came to an end as it was placed onto care and maintenance in Q4 2018 in preparation for closure.
Canada production decreased by nine per cent to 1.1 million carats due to planned lower grades at Gahcho Kue. Victor production decreased by four per cent to 0.2 million carats as it reached the end of its life during Q2 2019.
Rough diamond sales were 9.0 million carats (8.3 million carats on a consolidated basis)3 from three sales cycles compared with 10.0 million carats (9.4 million carats on a consolidated basis)3 from the same number of sales cycles in Q2 2018. Demand for rough diamonds remains subdued as a result of challenges in the midstream with higher polished inventories, and caution due to macro-economic uncertainty, including the US--China trade tensions.
The H1 2019 average realised rough diamond price decreased by seven per cent to US$151/carat (H1 2018: US$162/carat), which was driven by a four per cent reduction in the average rough price index and a change in the sales mix in response to weaker conditions.
Full Year Guidance
Production guidance1 is revised to ~31 million carats, the lower end of the previous range (31-33 million carats), in response to weaker trading conditions experienced in the period.
1. De Beers Group production is on a 100% basis, except for the Gahcho Kue joint venture which is on an attributable 51% basis.
2. Orapa constitutes the Orapa Regime which includes Orapa, Letlhakane and Damtshaa.
3. Consolidated sales volumes exclude De Beers Group's JV partners' 50% proportionate share of sales to entities outside De Beers Group from Diamond Trading Company Botswana and the Namibia Diamond Trading Company, which are included in total sales volume (100% basis).
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|Title Annotation:||Leading Companies|
|Publication:||South Africa Mining|
|Date:||Aug 16, 2019|
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