Okwa Diamonds (Pty) Ltd has acquired Ghaghoo diamond mine from Gem Diamonds (Pty) Ltd. Okwa Diamonds has actually acquired Gem Diamonds Botswana (Pty) Ltd, which its primary asset is Ghaghoo diamond mine, from Gem Diamonds (Pty) Ltd.
The acquisition is for a cash consideration of four million United States dollars (US$4 million), which is over Forty million pula.
Okwa Diamonds is a joint venture between Botswana Diamonds PLC (BOD), and Vast Resources PLC (VAST). The venture was formed to facilitate a smooth acqusition of Ghaghoo Diamond mine located in central Botswana. The mine is currently under care and maintenance.
“BOD has an initial free carried interest of 10% in Okwa Diamonds Pty Ltd (“Okwa”) for the first US$15million of expenditure by Okwa, which is being funded by VAST (including the acquisition cash consideration). Thereafter, BOD will not be diluted below 2.5% of Okwa. BOD can also earn up to a further 20% interest in Okwa through funding 20% of expenditure. Under the terms of the joint venture with VAST, BOD will be the operator of the Ghaghoo mine until such time as an agreed management team is in place.” a statement by Botswana Diamonds announced.
Ghaghoo Diamond mine is a ten point eight hectare (10.8 ha) kimberlite pipe located in the Central Kalahari of Botswana and was discovered in 1982 by Falconbridge Mining (later Xstrata) and evaluated in joint venture with De Beers up to 2007. Gem Diamonds acquired Ghaghoo from De Beers and Xstrata in May 2007. Gem Diamonds continued to evaluate the project and a study was undertaken in 2010 to determine the most viable way in which to exploit the deposit. A Mining License was awarded to GDB in 2010. Further work on the kimberlite was deemed appropriate, and Gem Diamonds embarked on underground development to bulk sample the pipe in 2011/2012 through a decline shaft, and this developed into commercial production in 2015.