Unpacking the story of Letšeng

Unpacking the story of Letšeng

Lemohang Rakotsoane

MASERU

THE Letšeng Diamonds chairperson Clifford Elphick says lack of skilled workers is a major impediment to diamond mining in Lesotho.

Speaking at the launch of the Letšeng Discovery Centre in Maseru last Friday, Elphick said unskilled human resource is “the key risk to a sustainable Letšeng and a major hindrance to the growth of the diamond mining sector in Lesotho”.

Elphickblamed Basotho’s tendency to direct much of their energy to politics instead of development issues that can bring a lasting solution to the country’s economic problems.

“In my opinion, a great deal of our time is wasted because of the emphasis which is placed exclusively on politics,” Elphick said, adding that we should assess how the delay in acquiring adequate skills is impacting on the economy.

He said“ensuring that we have the correct technical skills to operate Letseng is the GOL (Government of Lesotho)’s and Gem’s biggest risk and therefore top priority,” Elphick said.

Gem Diamonds holdsa 76 percent stake in Letšeng Diamonds with the government of Lesotho holding the remaining 24 percent.

Elphick added that there has been progress in training the locals in various mining skills,which will benefit not only Letšeng but also Kao, Mothae and the emerging Liqhobong mines that are in the neighbouring district of Butha-Buthe.

Letšeng Diamond is in Mokhotlong.

Elphick said regardless of the challenges facing the mining industry Letšeng is still committed to the development ofLesotho.

“It is sadly known that the resources industry globally has been througha tumultuous time since the late 2008 global financial crisis and the background conditions remain extremely difficult. Investments have dried up and operations have been forced to downsize to remain competitive,” Elphick said.

“The environment has been extremely difficult with massive numbers of mines closing, huge job losses, decreases in output and falling revenues worldwide,” he said.

Elphick said mining giants like Anglo-American are now just a mere shadow of what they used to be. However in Lesotho the diamond mining industry has resolutely stuck to business and soldiered on.

“We have focused our attentions, slashed costs and we have survived. This has meant that Letseng has been able to produce good results, Kao is improving its outlook and the Liqhobong mine is moving towards production,”Elphick said.

He indicated that unfortunately the Mothae ore body was abandoned by its shareholders as uneconomic but efforts are being made to see if a new investor with a different cost base and approach can make it a viable business.

Elphick said Letseng’s future is dependent on the international market price for large diamonds which is volatile.

“We of course do not set prices therefore the health of … the economy of the USA, which buys 40 percent of all diamonds, is our main concern. There are however many (that are) controllable, which we will continue to manage with the closest attention, unrelenting focus and skill,” Elphick said.

“The constant search for operational efficiencies and excellence, the relentless drive to control costs while maintaining high production levels to benefit from scale efficiencies and unit cost reduction, is our burning mantra,” he said.

“Material investments will continue to be made to address operational challenges such as the shortage of key skills. We will hunt these skills wherever they are in the world and bring them to Lesotho to assist us to be competitive and successful.”

Elphick said Letšeng’s performance is a very good one when bench marked and compared to their diamond mining peers in the world.

“We are justifiably proud of what we have achieved in the past, particularly in the past extremely difficult years. Our partnership has been hugely successful and we rededicate ourselves to continuing that success,”he said.

Elphicksaid the Letšeng Diamond Discovery Centre is a start of a journey aimed not to only tell Letšeng’s story but to educate and expose tens of thousands of Basotho to the excitement, complexities and opportunities of diamond mining in Lesotho.

“Our objective is to provide access to the diamond story, the facts and the figures and the history to scholars, men and women of Lesotho as well as decision makers and tourists. Our ambition is to make it an interesting and educational experience for all,”Elphick said.

Speaking at the same event the Minister of Mining Lebohang Thotanyana said Lesotho is among the top 10 diamond producers ranking number nine, “a position we believe will improve to number seven by 2020 following full operation of four new mines”.

“This has therefore led the government to establish the Letšeng Diamond Discovery Centre, which will serve not only as a diamond exchange platform but also for Kimberly Process Compliance, facilitation for diamond beneficiation and creating a suitable environment of the ASM sub-sector,” Thotanyana said.

He noted that the diamond industry has made a commendable contribution to Lesotho’s economy “especially since the reopening of Letšeng Mine in 2004, hence the mining sector being identified as one of the economic growth enablers in the National Strategic Development Plan”.

The growth of the industry has contributed to the increase in the mining sector’s share in GDP from 0.9 percent in 2004 to 7.7 percent in 2014.

The diamond industry has also been pivotal in increasing Lesotho’s export earnings resulting in increased gross foreign reserves as our diamonds are traded in the international markets.

“Therefore the industry has and continues to make a significant contribution to Lesotho’s capacity to maintain the Loti-Rand peg,” he said.

Thotanyana said the government sees the facility as one of the major steps by the diamond mining industry in helping achieve the Mining and Minerals Policy objective of transparency in all aspects of administering and managing the country’s mining and mineral sector.

“The centre is going to be an important information hub for the industry.  This is very important owing to the great lack of knowledge about the diamond mining industry which was discovered during the national consultations on Mining and Minerals Policy,” Thotanyana said.

He urged schools to use the centre to learn about the industry.

The Letšeng Diamonds CEO Mazvi Maharasoa said the centre is not a museum but a facility that will leave visitors energetic with pride for what Letšeng and the country have achieved since the first discovery of the diamond deposits in the hinterlands of the Mountain Kingdom.

“The primary objective of the centre is to promote knowledge, learning, enlightenment and understanding about Lesotho’s diamond resources in a global context,” Maharasoa said.

“It serves as a learning fountain for all Basotho who wish to pursue careers aimed in developing the country’s diamond mining industry,” she said.

She said the diamond mining sector has been misunderstood for a long time and very little was known of what was happening in the sector.

Therefore the centre couldn’t have come at the right time, when knowledge and information about the sector needs to be shared with the nation and Letšeng saw it fitting to be the author and custodian of this invaluable and intriguing information.

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