Angola seeks to boost diamond output, negotiating with major players

By Sergio Goncalves

LISBON, March 2 (Reuters) - Angola plans to boost diamond
mining and open a new large mine in the east, aiming to produce
5.7 million carats there in 2023, or more than half of its total
output last year, Mineral Resources and Petroleum minister
Diamantino Azevedo said.

In an interview with Reuters, he also said the state-owned
diamond company Endiama had been "instructed to negotiate with
the biggest companies in the mining world to invest in the
diamond subsector" in other projects, without specifying.

Asked if Angola was negotiating specifically with diamond
majors De Beers Group and Rio Tinto to enter its mining
sector, he said: "I confirm ... The latest information we have
is that the negotiations are going at a good pace."

Angola - the world's sixth-largest producer - produced 8
million carats in 2020, 23% below the initial plan and down from
2019's 9.4 million carats due to the global economic meltdown
from the COVID-19 pandemic, Azevedo said.

But "the prospects for 2021 are encouraging" with two new
projects due to start producing in the second quarter, and
Angola targeting a total output of 10.1 million carats in 2022.

Despite the "unfavourable situation due to the lockdowns
caused by the COVID-19 pandemic, we are working to accelerate
the start of production in Luaxe", he said. The project in the
eastern province of Lunda-Sul is close to the Catoca mine, now
responsible for 70% of Angola's diamond production.

It will begin pilot production this year.

"We are committed to transforming the Luaxe deposit in 2022
into a structured and organised conventional mine, expecting
production of about 5.7 million carats in 2023," he said.

With 41% each, Angolan state-owned company Endiama and
Russia's Alrosa are the largest shareholders of Sociedade
Mineira de Catoca (SMC), owner of the Catoca mine.

SMC owns 50.5% of the Luaxe project, while Endiama and
Alrosa each hold another 8%.

"Although Luaxe is in attractive project for any investor,
its shareholding structure has already been established,"
Azevedo said, without elaborating further.
(Additional reporting by Noah Browning, editing by Andrei
Khalip and Philippa Fletcher)