Sourcing

Largest New Diamond Mine of the Decade Coming Online in Angola

SourcingNov 29, 2023

Largest New Diamond Mine of the Decade Coming Online in Angola

The Luele mine is expected to eventually make the country the world’s third-largest diamond producer.

Diamond development hub in Angola
Angola’s diamond development hub in the city of Saurimo, as photographed in November 2021. The country announced the opening of a new, large diamond mine Monday—Luele, formerly known as Luaxe. (Photo credit/courtesy of Paul Zimnisky)
Luanda, Angola—Officials in Angola touted the opening of a large new diamond mine Monday, a project that marks a milestone for natural diamond production that will be unmatched in this decade.

The Luele mine is located in northeastern Angola, adjacent to the country’s other large diamond mine, Catoca.

The government announced the opening of the mine Monday, per a report published Tuesday by Reuters.

According to the news outlet, the government’s presentation on the mine did not disclose its projected production for 2024.

However, diamond industry analyst Paul Zimnisky said, according to his estimates, Luele will produce 3.5 million to 4 million carats annually, with production gradually ramping up in 2024 and the mine reaching full commercial capacity in 2025.

He noted there is an option to expand the mine’s processing plant, which could double production.

The ramp-up of production at Luele will be enough to eventually make Angola the third-largest diamond producer in the world in terms of both volume and value, leapfrogging Canada, especially since the Renard mine in northern Quebec was just mothballed.

(Russia is the world’s No. 1 diamond producer in volume terms, followed by Botswana. Botswana is No. 1 in value terms, trailed by Russia.) 

“It’s a huge deposit,” Zimnisky said in an interview with National Jeweler Tuesday. 

“This is the only diamond mine of significance that’s going to come into production this decade. It’s a big deal from that standpoint."

 Related stories will be right here … 

Luele was formerly known as Luaxe.

In the past, numerous reports described the development of the deposit as a joint venture between Sociedade Mineira de Catoca—the joint venture that operates the neighboring Catoca mine—and Russian diamond miner Alrosa, which remains under U.S. sanction following Russia’s 2022 invasion of Ukraine.

In the January 2022 issue of Rapaport magazine, the publication’s then Senior Editor and News Analyst Avi Krawitz, who had traveled to Angola in late 2021, broke down the mine’s ownership like this: Catoca, 50.5 percent stake; Endiama, 13 percent stake; Alrosa, 13 percent stake; Cecadiam, 9 percent stake; Chela Group, 6 percent stake; Kamen, 4 percent stake, and Reform 4 percent stake. 

However, Alrosa’s name was conspicuously absent from the presentation given about Luele as it formally launched Monday, according to an individual with knowledge of the presentation. 

It listed Catoca as having a 50.5 percent stake, as previously reported, while state-owned mining company Endiama’s interest in the project has increased to 25 percent. 

Reform’s interest remains at 4 percent while the Geological Institute of Angola now holds a 1 percent stake.  

According to the presentation, a company called Falcan, which was not previously listed as one of the mine’s owners, holds the remaining 19.5 percent interest in Luele. 

It is unclear who owns Falcan and the presentation did not note that Alrosa, while no longer listed among the owners of Luele, has a 41 percent stake in Catoca. 

Neither Catoca nor Alrosa responded to an email request for comment sent overnight regarding the ownership of the Luele mine.  

Michelle Graffis the editor-in-chief at National Jeweler, directing the publication’s coverage both online and in print.
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