De Beers Group and the Government of Botswana have concluded negotiations on a new 10-year sales agreement for rough diamonds from Debswana, their 50:50 joint venture.
The deal, which also includes an extension of Debswana’s mining licences, follows a lengthy negotiation process that began in 2019 and saw multiple extensions of the previous agreement.
Key Terms of the Agreement
Under the new agreement, the Botswana government’s state-owned diamond trader, Okavango Diamond Company (ODC), will initially receive 30% of Debswana’s rough diamond production. This share will gradually increase to 50% by the end of the contract in 2035.
Debswana, which operates Botswana’s major diamond mines—Jwaneng, Orapa, Letlhakane, and Damtshaa—has secured an extension of its mining licences beyond their original expiry date of 2029. The agreement aligns with the heads of terms reached in September 2023, which outlined a 25-year extension.
As part of the deal, De Beers will contribute to the “Diamonds for Development Fund,” investing BWP 1 billion (approximately $75 million) upfront, with further contributions of up to BWP 10 billion ($750 million) over the next decade. The fund is intended to support employment, training, and local diamond processing in Botswana.
Market and Industry Implications
The conclusion of negotiations provides stability for the global diamond market amid ongoing supply chain disruptions and economic uncertainty. De Beers CEO Al Cook credited the new Botswana administration, led by President Duma Boko, for facilitating a smooth resolution to the talks. Under the previous government, negotiations were more contentious, with former President Mokgweetsi Masisi at times threatening to end Botswana’s long-standing partnership with De Beers.
Industry analysts note that the agreement ensures a steady supply of rough diamonds at a time when global supply chains have been affected by sanctions on Russian diamonds. Hans Merket, a researcher on diamond mining, commented that securing the deal was necessary for maintaining a stable and ethical diamond supply.
Elodie Daguzan, Executive Director of the World Diamond Council, welcomed the agreement, stating:
“This development underscores the importance of long-term, stable partnerships in the diamond sector. Botswana has been a leading example of how responsible diamond mining, through successful collaboration with the private sector, can drive sustainable growth.”
Botswana’s Minister of Minerals, Bogolo Kenewendo, confirmed that the formal signing of the agreement is expected before the end of February 2025. The deal includes an option for a five-year renewal beyond 2035.
Impact on the Jewellery Industry
For jewellers, the agreement secures continued access to diamonds from one of the world’s largest producers. As Botswana’s share of Debswana’s production increases, ODC’s growing role in the market could influence purchasing dynamics for manufacturers and traders.
The agreement also reflects a broader trend of producer nations seeking greater control over their diamond resources. Botswana’s focus on developing its local diamond cutting and polishing industry may create new sourcing opportunities for jewellers in the future.
Overall, the agreement provides stability in the market and reinforces Botswana’s position as a key supplier in the global diamond industry.
