Petra Diamonds to sell Mwadui mined rough diamonds through a tender

19Nov 2021
The Guardian Reporter
Dar es Salaam
The Guardian
Petra Diamonds to sell Mwadui mined rough diamonds through a tender

LONDON -listed Petra Diamonds announced that it will sell by tender rough diamonds mined from Williamson Diamond Mines located at Mwadui in Kishapu district of Shinyanga region, on November 19 in Antwerp, Belgium.

Petra Diamond’s Mwadui mine in Kishapu district of Shinyanga region.

In a statement this week, the company said it will sell a parcel of 26,000 carats which includes a 32.32 carat pink stone of exceptional colour and clarity. In terms of section 87 (1) (b) of the Mining Act, a royalty of five percent is payable on the sale of diamonds mine at Williamson Diamond Mine.

Petra is also required to pay corporate tax at the rate of 30 percent as per relevant sections of the country’s Income Tax Act of 2014 together with an export levy of 0.3 percent of the diamond sold. This will be the first tender after the restart of the mine’s operations in the country during the third quarter of this year.

 The mine was placed on care and maintenance in April 2020 in order to preserve its liquidity, at a time when diamond prices were adversely impacted by the coronavirus outbreak. Cash on-mine costs, mainly associated with care and maintenance expenses, totalled around U$12.7 million during the year, the company said.

Petra Diamonds in September this year announced that it had decided to review its strategic options at its local asset and had therefore classified it as an asset held for sale for ‘financial reporting purposes,’ the company announced in its unaudited results for the year ending June 30, 2021.

Petra Diamonds holds a 75 percent in Williamson Diamond Mine, while the remaining 25 percent stake belongs to the government. The company in August last year said that it had not yet received an offer even after launching the formal sale process.

Minerals Minister Doto Biteko said recently that the government, as a shareholder, wasn't satisfied with the manner in which Petra Diamonds approaching the matter adding that there were discrepancies in the notice for sale of the mine that should be resolved before moving forward.

“We were in discussion with the mine and were at the final stages of signing a framework agreement, so you can imagine our surprise when we saw the sale announcement,” Biteko said. Williamson is an open pit diamond mine sitting on a 146 hectare Mwadui  Kimberlite pipe, which is one of the world’s largest. The mine’s lifespan is up to 2031.

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