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Foreign ventures sharpen mining industry’s edge

Article - April 3, 2014
As the fourth largest diamond mine by value in the world, Catoca has been at the forefront of Angola’s drive to expand its mining operations
ANGOLA
The massive Catoca diamond mine, which is operated by the state-owned Sociedade Mineira de Catoca (SMC), has not only recently expanded operations to increase diamond production in its native country, but its operator is also looking for further opportunities abroad.

Following an announcement by the Ministry of Geology and Mining, this year SMC will start exploring two fields in Zimbabwe for diamonds and other minerals. The venture is a sign of Angola’s growing position as a key global player in the worldwide diamond industry and the ability of companies from the country to make the most of regional opportunities.
 
Catoca is the sixth most productive diamond mine by volume in the world. In 2012, it produced 6.5 million carats from 10 million metric tons of ore, generating revenue of $575 million before costs, and accounting for about 70% of the country’s diamond output. 
 
SMC has opened a second mill and is now considering a third venture at its Tchiuzo site this year. Much of the company’s success has been attributed to the country’s transformation of its transport and essential services infrastructure, which has enabled the country to fight back following its long-running conflict. Alongside this, the firm has been a key adopter of the Kimberley Process Certification Scheme (KPCS), helping to prove the ethically sound source of its diamonds. 
 
The make-up of the company has also allowed the mining operator to expand quickly. 
 
SMC is a partnership between Angolan diamond company Endiama, Russia’s Alrosa, Israel’s Daumonty and Brazil’s Odebrecht. It has seen an array of skilled foreign workers help improve efficiency and provide expertise that has helped reduce the risk on individual projects.

“In 2014 we will make use of our knowledge so that we can contribute to improving conditions and quality of life”

José Manuel Ganga Júnior
CEO of Catoca
Ensuring Angola makes the most of the wide variety of products available to it, not just diamonds, has become an important strand to the country’s future growth prospects. 
 
While oil has become a mainstay for the nation, it is widely thought that are still other extensive mineral resources unexplored. The new National Geology Plan will indentify which minerals lie beneath its populations’ feet.
 
Encouraging foreign investment has become key for firms such as SMC, which is in the midst of a widespread expansion plan known as Vision 2020. It has a goal to ramp up its revenues and is looking to increase the operational and financial stability of its mine, keep production stable, and improve energy facilities. 
 
According to CEO José Manuel Ganga Júnior, the aim is for SMC’s turnover to grow from 60 billion kwanzas ($616 million) currently to 150 billion kwanzas ($1.54 billion).
 
The plan for the future also includes a sustainability program focused on three main areas: safety in the workplace, occupational health, and the environment. 
 
The CEO highlights the company’s ongoing social ventures that have included the building of schools and hospitals that are intended to enhance the region’s social and economic conditions and living standards. 
 
“In 2014 we will make use of our knowledge so that we can contribute to improving conditions and the quality of life of the population and growth of the country’s economy,” he told the media at the beginning of the year. 
 
Mr Ganga Júnior was the 2012 winner of Angola’s prestigious CEO of the Year award from Sirius, which aims to recognise, encourage and reward good practices by managers, companies and organisations. He firmly believes that using the profits of mining to improve the opportunities of the nation’s workforce is a vital step for Angola as it seeks to further develop its position on the global stage. 

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