With just about eight years life left in its South African land operations, Trans Hex, South Africa’s second largest diamond producer, is looking to replace and grow production.
And while the company may be able to buy some loss-making De Beers operations that fall off the table in future, the main focus is Angola, where the R1.5 billion company has already injected R458 million exploring what has been dubbed ‘elephant country’ when it comes to diamonds.
This has not yet paid off.. In the year to end-March 2005, Trans Hex made a mere R3 million operating profit out of Angola, compared to R363 million in South Africa where rand strength has hampered profits.
However R52 million, or 78% of the company’s R67 million in exploration spend for the last financial year went into Angola. This year it may be more, with group spend budgeted at R75 million and “most of that going to Angola,” according to management.
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