'Shape Up or Ship Out' in Zimbabwe Diamond Industry

Miners in Zimbabwe where diamonds are a substantial portion of the national exports. Anjin is retrenching nearly 1000 workers., a photo by Pan-African News Wire File Photos on Flickr.

‘Shape up or ship out’

December 30, 2013
Martin Kadzere and Golden Sibanda
Zimbabwe Herald

GOVERNMENT has laid strong terms on its demands that diamond mining companies extracting the gems in Chiadzwa should invest more funds to exploit deep seated conglomerates or risk losing their mining licences.This comes as diamond mining firms have requested to be allocated more claims to extract alluvial gems after exhausting surface diamonds, arguing the now remaining deep seated conglomerates were expensive to mine.

Officials at the seven diamond mining companies licensed to extract the gems made the claims during a familiarisation tour of the mines by Mines and Mining Development Minister Walter Chidhakwa early this month.

Minister Chidhakwa said that the diamond mining companies must balance between exploitation of both the alluvial and conglomerate diamonds, and that they should have also planned for this possibility a long time ago.

It appears, the companies, largely bent on making quick profits without proper geological survey to determine how long the surface reserves would last, never had foresight or long term vision as to plan for requisite future investment.

Despite investing very little to extract alluvial diamonds and exploiting the precious metal for a number of years it appears most of the firms do not have readily available funds to immediately invest in extraction of conglomerates.

Mines and Mining Development Deputy Minister Fred Moyo last Friday said the diamond miners should look for the requisite resources and start extraction of conglomerates or risk losing their licences to other investors.

“They should look for capital to mine the conglomerates, all the diamonds, but if they don’t want other people will come and mine,” said Mr Moyo. “We have a lot of diamonds in Chiadzwa and more investment is needed.”

He likened the miner’s situation to the harvesting of low hanging fruits whereby a farmer would claim that there are no more fruits as soon as he is no longer able to reach the ones at a much greater height from the ground.

Alluvial diamonds are gems that are mainly found on the surface (sand, gravel and/clay) as a result of natural erosive action that even small scale miners can use basic equipment like sieves, shovels and pans to dig out.

To the contrary, conglomerate diamonds are gems found in deep seated rock consisting of individual stones (larger than sand) that have been cemented together and require highly mechanised machinery to extract.

Ostensibly, the diamond mining firms took advantage of Government’s benevolence in allowing them to simply start the extraction of alluvial gems without them first providing plans on how they would latter exploit conglomerates.

The companies, licensed to mine the diamonds — Mbada Diamonds, Marange Resources, Anjin Investments, Diamond Mining Company, Jinan, Kusena and Gye Nyame requested further allocations of untapped diamond fields, promising to revert to current claims when they get efficient technology, meaning no financial resources have been set aside for reinvestment, neither was their foresight that could have seen them prepare in advance for such an eventuality.

Zimbabwe cannot afford to compromise on the potential contribution of diamonds to economic development at a time when Government expects the mining sector to anchor economic growth, especially over the period 2014 to 2018.

And diamonds have a big role to play in this regard, particularly considering that it is believed that Zimbabwe has potential to account for a fifth of the billions of dollars generated annually from the sale of gems globally.