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Letšeng makes another massive diamond find

Herbert Moyo

LETŠENG Diamonds continued with its impressive performance of recovering high quality diamonds, with the latest find being a 100.5 carat top white colour Type IIa diamond from its mine in Mokhotlong.

Gem Diamonds, which owns 70 percent of Letšeng Diamonds with the remainder held by the government, released a statement on Tuesday announcing the latest find.

“Gem Diamonds Limited (LSE: GEMD) is pleased to announce the recovery of a 100.5 carat, top white colour Type IIa diamond from the Letšeng mine in Lesotho, the highest dollar per carat kimberlite diamond mine in the world,” the company said in a recent statement.

This recovery is the eleventh diamond of over 100 carats that the company has made in 2018.

Back in May this year, Gem Diamonds Limited also recovered a 115 carat, top white colour Type IIa diamond.

The finds are the latest in the long line of impressive performances by the Letšeng Mine which also saw the recovery of a 910 carat diamond in in January this year.

The 910 carat diamond, which was christened the ‘Lesotho Legend,’ was sold for a staggering US$40 million (M520 million) at an auction in Antwerp in Belgium in March this year.

Letseng has also recovered a high-value 117 carat diamond and a 110 carat Type IIa diamond this year.

The robust trend continues from that of last year when a 115-carat diamond was recovered in September.

 

In June 2017, the mine recovered two large diamonds one a high-quality 104.73 carat, D-colour Type IIa diamond and the other a 151.52 carat Type I yellow diamond.

Before that in May 2017, the mine recovered a high-quality 80 carat, D colour Type II diamond, while in April it recovered a 114 carat, D colour Type II diamond of exceptional quality.

Although the country occasionally makes such huge diamond finds, there is however, concern from some sections of society that the country is not significantly benefitting from its mineral resources.

Finance minister Moeketsi Majoro revealed in a May 2018 interview that although Lesotho “occasionally made massive diamond finds including the ‘Lesotho Legend’, unfavourable contracts that the successive governments negotiated with the mining companies negatively impacted on the earnings that accrued to the state”.

He said although the government had negotiated for 10 percent royalties from the sale of diamonds, the state was often forced to settle for as low as eight percent as was the case with the ‘Lesotho Legend’. He said this was because mining companies often pleaded with government to accept a lower percentage in royalties, citing operational costs which reduced their profit margins.

“The thing is that we have agreements that out of every diamond we get a royalty of 10 percent. That is one out of 10 and you just know right away that this is tiny.

“Our laws are such that even that 10 percent can be lowered by the minister and all these mines and the previous ministers lowered that so right now Letšeng pays only eight percent. So, on this US$40 million diamond you can calculate what eight percent is and that is what we got,” Dr Majoro said.

Calculated at eight percent, this means that government only realised US$3, 2 million for the sale of the 910 carat diamond that was recovered at Letšeng Diamond Mine in Mokhotlong in January this year.

 

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