RioZim’s associate Murowa Diamonds (Murowa) produced 546,391 carats of diamonds in the first nine months of 2019, earning US$63.5m for the company.
Murowa’s revenue far outpaced the state-owned Zimbabwe Consolidated Diamond Company’s US$45.4m from 1.011m carats in the period under review. The combined diamond production for the two players in the year amounted to 1.6m carats, worth US$108.9m.
Despite having produced only 34% of the total volumes for the period under review, Murowa accounted for 58.3% of revenues, apparently speaking to the quality of stones being produced by the ZCDC, whose underperformance in revenue terms comes after previous reports of undervaluation of diamonds and claims of collusion between top executives and buyers.
Murowa’s stones averaged US$116.20 per carat while ZCDC’s were sold at about US$44.90 per carat. Murowa posted a profit of US$6.8m in 2018 due to an increase of diamond production to 740,244 carats against the prior year’s production of 732,045 carats.
The company had suffered a greater part of the year due to a ground rental fee dispute which was escalated to the courts. Murowa contributed positively to the group’s results with a US$1.5m share of profit, up from US$1.4m in the prior year.
RioZim CEO Bheki Ncube has said Murowa would continue its strong performance from 2017, leveraging on investments made in previous years, including increased plant processing capacity and owner mining.
According to Ncube, “comprehensive process optimisation and further exploration drilling for better ore body knowledge enabled Murowa to produce 740,244 carats which was consistent with the 732,045 carats produced in 2017.”
Nkomo said Murowa remained proactive in identifying opportunities that would maintain its growth trajectory. The company is currently focused on extending its mine life as well as increasing production through various initiatives.
The extension of mine life, he said, would require significant investment in various aspects, including exploration. Last year, Business Times reported a multi-million-dollar hunt for diamonds in the Chivi area of Masvingo.
This is taking a toll on RioZim amid information that the exploration is producing negative results.
Diamond mining industry sources say while there is an occurrence of diamonds in the area, the viability of commercial mining is not so clear. RioZim is yet to officially give an update on the exploration of its 3,000-hectare concession.
RioZim currently produces diamonds from its 33,000-hectare Murowa Diamonds concession where it found three kimberlitic pipes after seven years of exploration.