Debswana, a joint mining operation between the Botswana government and De Beers, this weekend announced the launch of Cut 8 – a $3.63 billion project intended to extend the life of the Jwaneng diamond mine by seven years.



Jwaneng is considered the world's richest diamond mine and accounts for 60-70% of Debswana's profits, but operations had been scheduled to end in 2017 as the mine's life ran out. Cut 8 – which Bloomberg notes is the largest capital expenditure in the history of southern Africa – is expected to produce some 102 million additional carats of rough diamonds.

The expansion of the Jwaneng diamond mine is expected to add 1,700 jobs. Botswana President Ian Khama, who inaugurated the Cut 8 project at a ceremony on Friday, said that it "showcased Botswana's economic capacity and potential to undertake a project of this size during recessionary times."

Botswana is one of the largest diamond producers in the world, but like the diamond industry worldwide the country's diamond sector took a bad hit in the global financial crisis. However, according to figures released last week by the Bank of Botswana, the country's diamond exports are on the increase, with the country having exported $2.36 billion worth of diamonds from January-October 2010 and $307.9 million in October 2010 alone.

Average monthly diamond exports by value stood at $236.1 million in 2010 – nearly double the average monthly diamond exports for 2009.