De Beers, Mvela embark on new project in SA

De Beers and Mvela have consented the terms of the agreement which will empower Mvela. It will receive 51% equity and De Beers will receive 49% equity in mining areas previously owned by South Africa�s government. De Beers will retain 66% of future projects concerning privately owned property developed between the two companies.

De Beers and Mvela jointly own Ndowana, an exploration joint venture focused on discovering new diamond mines. De Beers had agreed to negotiate marketing terms for mines on previously state-owned properties but recently charged for marketing diamonds and received a premium on diamonds sold.

"We look forward to successfully collaborating on our expertise and technologies to realize the economic potential of this partnership, with the vision to contribute positively towards the growth of sustainable diamond mining in South Africa into the future," said Bill Mckechnie, De Beers Group Manager of Exploration. The Ndowana joint venture was recently granted new order prospecting permits on two previously state-owned mining areas and has started exploration in those areas.

The joint venture partners have allocated 20 million Rand ($3.1 million) for exploration for the year ending June 30, 2006. "This agreement represents real, sustainable empowerment, where the risks and needs of both parties have been taken into account, resulting in an equitable economic flow-through," said Pine Pienaar, CEO Mvela.