Major commercial deal for diamond vessel

21 June 2019 | Business

In the largest commercial transactional deal this year to boost marine diamond recovery operations in Namibia, five commercial banks partnered in a N$5.6-billion financing deal to procure a new diamond recovery vessel for Debmarine Namibia.

The AMV3 is expected to create more than 161 new jobs alongside Debmarine Namibia's current workforce of 1 000 employees.

The N$5.6-billion asset financing facility constitutes 80% of the vessel cost and will be financed by Absa Bank, Bank Windhoek, Nedbank, FirstRand Bank and Standard bank Namibia.

Debmarine Namibia will cover the remaining N1.4 billion (20%) of this investment.

The facility will enable Debmarine Namibia to acquire a state-of-the-art marine diamond recovery vessel which will be custom built with world-class operational capabilities. The vessel will be used for marine diamond recovery operations off the southern coast of Namibia in the Atlantic 1 mining licence area.

The vessel is being constructed in the Damen Mangalia Shipyards in Romania and is scheduled to commence operations in 2022.

The new acquisition will be the seventh addition to Debmarine Namibia's fleet which currently comprises five diamond recovery vessels and one exploration and sampling vessel.

Speaking at the event, the CEO of Debmarine Namibia, Otto Shikongo, said that over the years they have grown the business and have increased the workforce to 1 000 employees of which 86% are Namibians.

Debmarine Namibia owns and operates five diamond recovery vessels the Debmar Atlantic, the Debmar Pacific, the !Gariep, the Grand Banks, the Mafuta, and one exploration and sampling vessel, the SS Nujoma.

Shikongo said additional to this, they charter a diamond recovery vessel, the MV Coral Sea. The annual production is now more than 1.2 million carats.

“The highest quality diamonds in the world are found in our ocean and with this investment we will be able to optimise new technology to find and recover diamonds more efficiently and meet growing consumer demand.”

According to Shikongo the new vessel will be owned by Debmarine Namibia and will be operated by competent staff of highly skilled men and women.

“Robust skills development and training programmes will run parallel to the construction of the vessel to ensure that the right people for the job are in the right places when the vessel is delivered. It will be registered at the port of Lüderitz and scheduled to commence operations in 2022.”

Shikongo said that the AMV3 will be the seventh and biggest vessel of their fleet, producing 500 000 carats per annum – an increase of 35% of their current production.

“In its first five years of production, the AMV3 is expected to contribute N$2 billion per annum in taxes and royalties to the Namibian treasury and the capital loan must still be repaid during that period.”

According to Debmarine Namibia the deal is one of the largest commercial transactions to be concluded in Namibia this year and further underscores both the government's and the De Beer Group's commitment to this successful partnership.

ELLANIE SMIT

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