47 / 90
44
F I G . 2 7 :
PROJECTED GLOBAL ROUGH D I AMOND PRODUCT I ON
Source: McKinsey & Company, ‘
Perspectives on the Diamond Industry
’, September 2014
60
30
90
40
10
20
130
160
140
150
110
0
50
120
100
80
70
170
2023
2028
2029
2030
2025
2026
2024
2027
2022
2020
2017
2016
2019
2014
2013
2012
2021
2015
2018
Expansions
New projects
Existing
Million carats
LOOKING AHEAD
DIAMOND PRODUCTION IS EXPECTED TO FALL GRADUALLY
WHILE OPERATING COSTS WILL CONTINUE TO INCREASE
Overall diamond supply is expected to increase in
the next few years, driven by new projects coming
on stream. By 2020, when many of the existing mines
will begin to see declining outputs, overall supply is
expected to plateau (see Fig. 27).
A number of projects are under way to expand
diamond production. By 2020, about 25 per cent of
carat production will come from projects currently
under development, but much of this increase in
output comes from projected expansion at current
mines such as Rio Tinto’s Argyle mine in Australia.
Among new developments, the largest are ALROSA’s
Botuobinskaya, Lukoil’s Grib and De Beers’/
Mountain Province Diamonds’ Gahcho Kué projects.
Beyond 2020, there is a risk that production levels
will begin to decline unless major new discoveries are
made in the coming years and rapidly developed. As
illustrated elsewhere in this report (see ‘Diamond
Exploration’ chapter), the likelihood of large
economically viable discoveries is low, and so supply
can be expected to decline gradually after 2020.
1
2
3
4
Rio Tinto’s decision to continue to
operate in the diamond industry. Rio
Tinto conducted a strategic review of
its diamond business, which included a
potential divestment. In June, the company
announced its decision to retain the
diamond business
27
.
In April, Rio Tinto commenced
underground operations at its Argyle
mine in Australia
28
.
BHP Billiton’s exit from the industry upon
completing the sale of its stake in the Ekati
diamond mine to Dominion Diamond
Corporation in April
29
.
In October, the Russian government
privatised 16 per cent of its stake in
ALROSA, by way of an Initial Public
Offering, for US$1.3 billion.
MAJOR EVENTS IN 2013
DIAMOND PRODUCTION