2001

De Beers Suspends Angolan Operations

Summer 2001

Following an impasse in negotiations with the Angolan Government, De Beers has suspended all its investments and prospecting operations within Angola.

Talks broke down after more than a year of negotiations on a decade-old contract among De Beers, the Angolan government and Ediama, the Angolan State Diamond Company.

Last year, the Angolan government suspended all contracts signed by Ediama and, instead, launched new legislation governing the prospectus and marketing of diamonds within the country. The move negated contracts signed with De Beers and moved control of Angola’s diamond output to the Israeli-backed Angola Selling Corp. Angola produces and estimated $600 to $800 million in diamonds each year.

The agreement between De Beers and Ediama had provided Angola’s diamond industry with financial support to develop mining, and a $50 million investment in the prospecting of diamonds in Angola’s Cuango Valley in exchange for De Beers exclusive control of marketing diamonds from the area.

"Unfortunately, 14 months after the decreed suspension of the contracts, no agreement has been reached," De Beers said in a statement. "Under these circumstances, the Board of De Beers is unable to justify continued investment in its projects in Angola."