African banks to fund construction of world's biggest marine diamond mining vessel

WINDHOEK – Five African commercial banks have partnered in a $375-million financing deal to build a new diamond mining vessel for a subsidiary of Anglo American's diamond unit De Beers.

Nedbank Namibia, RMB Namibia, Standard Bank, ABSA and Bank Windhoek agreed to provide 80% of the funding for the ship, which will be the world's largest of its type.

Debmarine Namibia - a 50-50 joint venture company between De Beers and the government of Namibia - will provide the balance of $94-million.

The ship, to be known as the AMV3, will be the seventh in the Debmarine Namibia joint venture's fleet, which mines high-quality diamonds from the ocean floor using hi-tech surveying equipment.

The AMV3 has the capacity to add 500 000 ct/y to production from 2022, and is expected to contribute two-billion Namibian dollars ($137.64-million) a year in taxes and royalties to the Namibian treasury in its first five years of production.

"The highest quality diamonds in the world are found in our ocean," Debmarine Namibia Chief Executive Otto Shikongo said in a statement.

"With this investment we will be able to optimise new technology to find and recover diamonds more efficiently and meet growing consumer demand."

Nedbank Namibia, which facilitated the arrangement, will contribute 40% of the financing and will also provide currency hedging for the deal, Karl-Stefan Altmann, an executive at Nedbank Corporate and Investment Banking and Treasury, told Reuters.

Mining, of which uranium and diamonds are a major part, contributed 14% of Namibia's gross domestic product in 2018, according to the latest annual report of Namibia's Chamber of Mines.

Diamonds also accounted for 14% of Anglo American's core profit in 2018.