Williamson Diamonds Limited (WDL) operates an open-pit diamond mine at Mwadui in the Shinyanga Province of northern Tanzania.
The mine has an illustrious past and is famous for the production of some of the world’s finest pink diamonds.
For the fifty years between 1958 and 2008, WDL was jointly owned by De Beers and the Government of the United Republic of Tanzania.
Originally the shareholding was split evenly but from 1994 De Beers held 75% and the Government 25%.
On 8th September 2008 De Beers entered into a contract to sell its entire 75% equity shareholding and all of its claims over WDL to Petra Diamonds Limited.
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The sale of De Beers’ interest in WDL was part of its ongoing drive to position De Beers for long-term, profitable growth through an intensive review of its global mining asset portfolio and an increased focus on those operations with the best strategic fit.
Although the Mwadui ore body is the largest mined kimberlite pipe in the world, its low grade and increasing clay content makes the operation technically and financially challenging.
Petra was recognised by De Beers and the Government of Tanzania as possessing the financial capacity and technical expertise required to restructure challenging mines and to return them to profitability.
Commenting on the sale, the Tanzanian Minister of Energy and Minerals, Hon. William Ngeleja, MP, said: “The Government of the United Republic of Tanzania is pleased to welcome Petra to Tanzania as its new partner in Williamson Diamonds Limited. This is an exciting opportunity to breathe new life into Williamson Mine and Tanzania’s diamond mining sector.”
Mining operations at Mwadui are focused on a kimberlite pipe. The pipe, measuring 146 hectares at surface, is the largest such deposit ever to be mined.
It was discovered in 1940 by Dr John Williamson, a Canadian geologist, following several years of exploration in Tanzania. The deposit has been mined continuously ever since and more than 20 million carats have been recovered to date.
On the death of Dr Williamson in 1958, De Beers purchased a 50% shareholding in WDL and the then colonial Government of Tanganyika took the remaining 50% in lieu of death duties. This shareholding arrangement pertained until 1994.
De Beers managed the operation until 1973 when the Government of Tanzania took over the function. In 1994, De Beers was invited back to manage the mine.
It was following the recapitalisation of WDL by De Beers that the shareholding was adjusted to the ratio of 75% De Beers and 25%Government.
Mining, drilling, blasting, loading and hauling at Mwadui is carried out by Caspian Limited, a Tanzanian contractor. Ore processing and diamond recovery takes place at two plants on site. The mine’s production is valued by a Tanzanian Government agency before sale.
Diamond recovery at WDL during 2007 totalled 220,209 carats (189,396 carats, 2006) from 3.2 million tons of ore treated (3 million tons, 2006).
Technical investigations conducted at Mwadui have indicated that the introduction of new technology could increase throughput to more than 7 million tons per annum.
This would result in an estimated annual production of 500,000 carats and an extension of the mine’s economic life by at least 20 years.
Mwadui Community Diamond Partnership
In September 2008 De Beers and Petra signed a Memorandum of Understanding agreeing to discuss the development of the multi-stakeholder Mwadui Community Diamond Partnership.
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