Irish exploration firm African Diamonds has defered court action against De Beers over plans to bring its Botswana AK6 diamond mine joint venture into production after an application for a retention licence was denied.
The dispute arose amid claims that De Beers used its position as majority stakeholder in the joint venture, Boteti, to pass a resolution applying for the retention licence, which could have delayed development of the mine indefinitely.
However, the Director of Mines of Botswana rejected the application for a retention licence, and said it could not be formally lodged as a mining licence application was still pending.
In a statement, African Diamonds said that agreement had been reached between De Beers and the Botswana Government on the marketing of AK6 diamonds, which was a key issue for De Beers.
Chairman of African Diamonds, John Teeling, said the company was happy with the new agreement. "Final details are now being worked out to enable agreement on the terms of a mining licence to be completed by September 30th," he said. "Our court case is on hold."
African Diamonds holds a 28 per cent stake in Boteti, De Beers has 71 per cent, and private Botswana firm Wati owns 1 per cent.Boteti received the terms for a mining licence from the government of Botswana on June 17th, but while African Diamonds said both it and Wati were happy to accept the licence terms, the Irish company claimed De Beers was not, and accused the firm of wanting to delay the project.
De Beers said power supply issues were compromising the economics of the project, a claim that was rejected by African Diamonds and Wati, who presented an independent study showing strong economic viability.