Investment group Gemcorp Capital and Endiama Mining, a subsidiary of Angola’s state-owned diamond miner Endiama, have partnered to develop the Mulepe diamond deposit in the country’s northeastern province of Lunda Norte.
Gemcorp will own 75% of the business and Endiama 25% and alongside with funding a pilot project, the London-based investment firm will oversee operations.
Mulepe, which contains significant kimberlite and alluvial deposits, represents a key strategic project for Angola, the JV partners said. It aims to provide employment opportunities and unlock value in a remote region of the country.
The companies will set up a pilot mining program during the course of the year to improve their understanding of the type and quality of diamonds present within the concession. They also expect to better determine the capabilities of local third-party service providers and value generation potential through diamond sales.
Following the pilot program, the JV partners will proceed with the $150-million development and expansion of operations.
At full production, Mulepe is expected to process about three-million tonnes a year of kimberlite and employ about 140 workers, mostly from the local community.
The project is Gemcorp’s first investment in diamond mining in sub-Saharan Africa. It already manages other large-scale projects in Angola, including the Cabinda Oil Refinery.
Gemcorp CEO Atanas Bostandjiev said the company is excited to continue playing a role in helping the country capture the full value of its natural resources, while supporting the development of local communities.
“Angola is a country full of potential, and this partnership is yet another example of our belief in Angola’s economic future,” Bostandjiev said in the media statement.
The country is the world’s fifth diamond producer by value and no.6 by volume. Its industry, which began a century ago under Portuguese colonial rule, is successfully being liberalized.
Angola held its first public diamond auction in 2019 and since then, producers no longer have to sell at below-market prices to a handful of buyers favoured by the state.
Last year, Endiama revealed it was seeking international partners in an attempt to place Angola among the world’s top-three diamond producers.
Before the coronavirus pandemic crippled global markets, Angola planned to increase annual diamond production to 14 million carats in 2022.