By John Grobler
WINDHOEK (Reuters UK) - Namibia and De Beers are close to concluding talks to increase to 50 percent the southern African country's holding in the local marine unit of the world's largest diamond producer, a De Beers spokesman said.
"The parties have concluded the substantive part of negotiations and are now involved in ironing out the final technical details," De Beers spokesman in Namibia Daniel Kali told Reuters on Thursday.
"And as you know, the devil is always in the details."
The government's 30 percent shareholding in De Beers Marine Namibia is held through Namdeb, a diamond production group owned 50/50 by the government and De Beers.
Presidential economic advisor Leevi Hungamo, who is involved in the negotiations, said a new holding company would be created, but he declined to give further details.
Namdeb's operations are largely based along the extreme south-western Atlantic coastline and the Orange River border with South Africa. Much of its operations involve exposing the ancient seabed to recover alluvial diamonds.
Namdeb, which accounts for 40 percent of Namibia's export earnings, holds mining licences over Namibia's famed Diamond Area 1, as well as the adjoining off-shore areas which are mined under exclusive contract by De Beers Marine Namibia.
Namdeb on Thursday reported a 40 percent slide in 2007 profit before tax mainly due to a 15 percent drop in rough diamond sales revenue and higher salaries and fuel costs.
Profits before taxes fell to 776 million rand ($98 million) from 1.29 billion rand, despite rough diamond production rising 4 percent to 2.177 million carats, Namdeb said.
Diamond sales revenue was 4.6 billion rand, down 15 percent due to less carats sold, a change in mix and a price correction in the second half of 2006.
"Rough diamond prices have been strengthening during 2007," Namdeb said.
At the same time, prospecting charges and other operating costs declined.
(Editing by Sue Thomas)
