De Beers says it is confident of finding a gem deposit in Angola that will enable it to more than recover the US$250 million it has spent on exploration in the country.
The company has found diamonds in a 3,000 square-kilometer concession near Lucapa in the Lunda North province, says Pedro Lago de Carvalho, De Beers business manager in Angola, in comments to Bloomberg.
The site is the one remaining concession out of five that De Beers has explored in the country since 2005, he said.
De Beers withdrew from Angola in 2001 after losing the right to sell more than US$800 million of diamonds. It undertook three rounds of arbitration with state-owned diamond company Endiama, before returning to the country eight years ago.
Angola is the fifth-largest diamond producer by value, and is believed to have the biggest unexplored diamond potential after Russia and China, Lago de Carvalho said.
"We are confident we can find something that will allow us to recover all our investment," he says. "The contract is clear, there is no debate."
The results of evaluation studies of three kimberlites at Mulepe, about 800 kilometers east of the capital of Luanda are due to be known in about two months, and will be followed by meetings with Endiama to decide how to proceed, Lago de Carvalho said.
De Beers holds a 49-percent stake in Mulepe, with Endiama holding the rest, according to an exploration deal signed before a new mining law came into force in late 2011. The law reduces the minimum share the government insists on retaining in future projects to 10 percent and cut taxes to 25 percent from 35 percent.
The reserve's economic viability would have to be determined and a mining contract would still need to be negotiated, Lago de Carvalho said. "We don't have a deposit per se, it's still in the exploration phase," he says. "There is no formal time line."
The country is a "high priority" for De Beers, which has set aside a US$30 million annual prospecting budget that's unlikely to decline soon, he said.
Angola sold 8.33 million carats valued at US$1.16 billion in 2011, according to Kimberley Process figures. Angola was in fifth place after Botswana, Russia, Canada and South Africa.