Angola's Endiama weighs listing

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Angola's Endiama weighs listing
Allan Seccombe
Posted: Thu, 08 Feb 2007

[miningmx.com] -- ANGOLAN state diamond company Endiama is investigating a listing in Toronto or London, and it is undergoing a review process that will from June change the way it and its marketing arm Sodiam operate, marketing director Sebastiao Panzo said on Thursday.

“From the second quarter of this year we foresee a change will start happening in the diamond sector,” Panzo said on the sidelines of the Mining Indaba in Cape Town.

Endiama has employed Morgan Stanley to investigate a listing in either Toronto or London for the diamond company, which partners all diamond companies in both alluvial and kimberlite projects in the country.

diamond trading opened up

The timing, venue and size of listing have not been finalised.

The reason for Endiama listing is to raise capital towards a massive geological survey and compilation of a database of diamond deposits in the country and the identification of kimberlites. Angola already has 1,000 discovered kimberlites.

Endiama is currently compiling geological survey data from companies who are granted 3,000 square kilometre concessions for exploration.

“There is still a lot to discover in my country,” Panzo said. “We urgently need to upgrade our geological database and bring as many mines into production as possible.”

Of key interest to existing and potential investors in Angola are the coming changes to the way Endiama forms partnerships with companies and the marketing of diamonds through Sodiam.

The government set up a committee last year to investigate the industry and recommend changes that will increase investment in the sector.

Some of the gripes diamond mining companies have about working in Angola are that it is enormously costly to explore and develop projects in the diamond rich but remote areas of Angola. Endiama takes a stake in these projects but puts up none of the capital. In the case of kimberlite projects Endiama is a majority stakeholder.

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Sodiam is said by mining companies to pay less than the market rate for rough stones, another factor that has put the skids under potential projects.

“One of the ideas displayed by other groups is that diamond trading is opened up for other companies. We’ll have to see,” Panzo said.

The committee will hand over its report to the National Assembly in June, which will discuss and implement the findings.

The committee has taken input from the World Bank, Russian diamond group Alrosa and world number one diamond producer De Beers, Panzo said.

The experiences of Botswana, the world’s leading diamond producer, Russia and South Africa are being taken into consideration.

Angola’s diamond output has risen steadily and in 2006 output was 9.3m carats from 7.1m carats the year before. Endiama would like to lift output to 10m carats by 2010 and has set itself a target of 19m carats thereafter.