• Market Watch

Building a ‘forever’ legacy

• 11 Months Ago - 2023-12-12 00:00:00

Riaan Burger is the chief executive officer of Namdeb Diamond Corporation, since his appointment to the top position at the equal partnership between the government of Namibia and the international diamond giant De Beers in 2017. By then, he had already amassed 22 years of experience for the oldest diamond mining organisation in the country, having joined Namdeb in January 1995.
His passion for the business and the lasting legacy this unique endeavour will leave for the country of his birth are palpable.
Having successfully steered Namdeb beyond the threat of mine closure, which loomed over the 2 500 employees in the days leading into 2022, Burger shares a candid conversation about the recent down cycle of international diamond prices, ramping up operations to a scale to be able to outlive current and future market turbulence, achieving production targets simultaneously, and the lasting impression made by ‘Mining for Good.’
Namdeb’s Long Term Plan (LTP) was announced in October 2021, giving birth to an implementation strategy focused on the ramp-up of operations at the corporation’s Southern Coastal Mines, “Namdeb’s mainstay and future,” as he describes it.
“That approval of the extension of our life-of-mine by more than 20 years has been a major milestone for us,” he recalls regarding the LTP go-ahead from the Namdeb board.
Previously, Namdeb was exploiting five mining faces along the southern Atlantic coast, cleaning about 400 000m² of bedrock per annum, he says. Through the process of accretion, the organisation is literally pushing back the sea to mine on dry land where the waves would previously crash to shore.
“We are really a unique mine, and people familiar with it know that the coastal ore body stretches from the land well into the sea. Since about 2010, we have been pushing back the waves and mining out the land that we accrete, using sand to create a dry area using a system of large seawalls and dykes,” he explains.
“We have moved Namibia’s coastline further out by between 800m and up to a kilometer or more in some places,” says Burger.
From 400 000m² per year, the ramp-up has increased capacity to clean bedrock stretching 800 000m², and is now at full capacity to cover some 1,4 million m² per year, achieved over the last two years. About 105 new pieces of machinery have been put to work, significant additional overburden stripping capacity (60%) is in place, and the Alternative Feed Stream (AFS) has been fitted with a new front-end to improve production throughput.
According to Burger, ramping up while maintaining production is tricky, and he is exceptionally proud of the 200 000 man-hours put in, with no loss-time injuries, to make it happen.
All this has been possible thanks to the Namibian government’s decision to grant Namdeb a five-year, 5% royalty remission from 2021 until 2025. Burger says Namdeb would have had to close without that assistance.
“It was absolutely essential for us. It was essential for us to bridge this period until we could fully ramp up; significant capital went into the ramp up, as did significant operational costs, so we are obviously very thankful for the government for giving that relief to us,” he said.
Not only were the jobs of 2 500 employees secured, but close to 600 more Namibians have found work with Namdeb or its contractors since, and considering the multiplier effect of seven more people found to subside off one person’s employment, the livelihoods of close to 18 000 people are now safe as a result, he explained.
“For me, it was a milestone of trust that the shareholders show in us, a fundamental belief that what we are doing is the right thing, and today I am so pleased that through this year we could actually demonstrate to the shareholders that if you give us the opportunity to do this, we will show you that we will achieve it,” he said. Namdeb achieved the 2023 carat production target in late November, he said.
Recently, more pressure has been put on Namdeb by the sustained downward trend of polished diamond prices internationally.
“There are a lot of factors coming together — a lot of macro-economic factors effecting the price of diamonds. The majority of our diamonds are sold in the United States. I think about half of the world’s diamonds are sold in the United States, and there are some macro-economic issues around that. China is a significant factor, and there are some issues around the Chinese economy and its expected recovery, so that is impacting where we see the market at the moment. Also, at the same time, there is stock in the diamond pipeline, which is affecting the outlook, at least in the short term. Of course, it has a direct impact on us in terms of our sales, but we do know these things are cyclical; we do know they change. What is important for us is that when we have these downcycles, we are able to work through them, which means making sure our efficiencies are there and that we optimise our mining faces. We reduce our capital expenditure at that stage, but what is equally important is that we know it is a cycle. We believe in the value of natural diamonds in the long term. It is so important to make sure you do not damage your long-term capacity to produce, and that is really what we are focusing on as a business. That is really our response to the current situation,” he said.
Namdeb is one of Namibia’s largest private sector employers, and Burger is happy that many ex-employees still come to the Namdeb stand at the annual Chamber of Mines Expo to thank the company for starting off their successful careers. “We really have been a key developer of Namibian skills,” he says with pride.
“At the moment, less than 1% of our employees are on work permits. We are really a Namibian company, built by Namibians, and we continue to invest in their skills. We have a very attractive training scheme for our employees, where we encourage people to study and support them in their studies. As a consequence, most of our people are studying something, and that is part of a culture that you create over time and is part of a legacy that a business can leave. What capacity do you leave behind for the country?” he said.
Part of the Namdeb legacy is also technological innovation, as demonstrated in the recent revelation of the first electric bus being put to work to transport employees to and from work.
“At Namdeb, we have a commitment to become carbon neutral, and we have a whole range of projects associated with that. Probably the most significant is a wind farm, which we are in the process of developing. Our intention is to replace about half of our electricity consumption with renewables. We are looking at solar options. Our office blocks in Oranjemund are completely solar. We have just done that, and we have a number of other projects. It is also what are you doing in terms of your diesel use? There are a number of options, like hydrogen. Electric vehicles will be part of the equation, so we have to take the first step,” he said.
“We will continue looking at what we do with the rest of our fleet,” he added.
Burger is also passionate about environmental custodianship, particularly for the restricted Tsau ?Khaeb (Sperrgebiet) National Park: “Of the entire park, we have disturbed in a hundred years of mining, less than 1%, so the mining footprint is very small. But we have a unique responsibility, and for years we have been working with the government and adapted our environmental plan to the future land use plan for the park. On sites that are of high conservation value, we have had complete rehabilitation so that people who visit now don’t realise that there ever was a mine. Now we have concurrent rehabilitation so that we don’t wait until we are at the end of the life-of-mine before starting rehabilitation,” he said.
Burger’s personal favourite related achievement is at the pocket beaches, north of Oranjemund, where he was the project manager twenty years ago.
“I think we set a standard of rehabilitation in those areas that you won’t see anywhere else,” he said.
Asked about the legacy he wants to leave behind at Namdeb one day and the legacy that Namdeb can leave for Namibia, Burger said he is most proud of the people transformation achieved.
“The talent, the passionate people who are so innovative that they surprise me every day; people that come out and do things against the odds, that is probably the thing that has given me the most joy in my work,” he said.
The Namdeb culture, where people feel free to try things, not always successfully but always progressively, is why Namdeb is where it is today, he said.