De Beers finds some of its most valuable diamonds on the Atlantic Ocean seabed off the coast of Namibia, and it’s betting there are a lot more to be discovered.
The world’s biggest diamond producer has spent $157 million on a state-of-the-art exploration vessel that will scour 6,000 square kilometers (2,300 square miles) of ocean floor for gems, an area about 65 percent bigger than Long Island. The Anglo American Plc unit mines in the area in a 50-50 joint venture with the Namibian government.
The vessel will scan and sample the seabed to identify the most profitable areas for De Beers’s ships, which suck up diamonds before they’re flown by helicopter to the shore. The strategy will help the company maintain annual production of at least 1.2 million carats for the next 20 years, Chief Executive Officer Bruce Cleaver said in an interview.
Those stones are “very important to our global mix and to our customers who are looking for higher-value diamonds,” Cleaver said.
Namibia’s diamonds, which have been washed down the Orange River from South Africa over millions of years and deposited in the ocean, are key to De Beers because of their high quality. While not the biggest, the gems have few flaws after being broken from larger stones on their way to the sea bed. Only the strong and good quality ones survive, Cleaver said.
De Beers’s Namibian unit sold its diamonds for $528 a carat last year, much higher than the $187 average for the whole company’s stones and accounting for about 13 percent of total earnings.
This article was provided by Bloomberg News.