Ghaghoo Mine faces final closure
Mbongeni Mguni | Wednesday March 22, 2023 16:34
Since February 2017, Ghaghoo Mine has been on care and maintenance activities which entail keeping the mine's infrastructure in prime condition in preparation for a possible reopening.
However, after prioritising a sale of the mine last year and watching a planned takeover deal with Botswana Diamonds fail in May, Gem Diamonds directors this week indicated they were moving to final closure in the CKGR.
Writing in the company’s annual report, directors said various alternatives, including a closure, were being discussed with affected stakeholders.
Last year, Gem Diamonds spent $1.9 million on care and maintenance activities at Ghaghoo, down from $2.1 million in 2021. Directors said the carrying value of the remaining assets had slipped to negative from zero in 2021. Final closure of the mine will trigger environmental rehabilitation obligations on Gem Diamonds in line with the country’s laws.
Ghaghoo, which was the country’s first underground diamond mine, was placed under care and maintenance in February 2017 due to depressed diamond prices. At least 250 workers had their contracts terminated as a result.