Petra Diamonds (LSE: PDL) said on Wednesday its Williamson mine in Tanzania would not resume production before the middle of 2023, following the partial collapse of a tailings storage facility (TSF) earlier this month.
The company said the decision comes after an assessment by a team of experts which concluded there is a low risk of further failures of the mine’s TSF. They also warned of a possible breach of the New Alamasi water dam.
On Nov. 7, part of the eastern wall of Williamson’s tailings dam collapsed, releasing 12.8 million cubic metres of water and tailings material that flooded nearby areas.
There were no injuries or fatalities and the mine pit was unaffected, Petra said. It added that water and tailings material samples taken by the Tanzanian government’s Chemist Laboratory Authority did not find dangerous chemicals and the ones detected were within normal parameters.
Petra, which also operates three diamond mines in South Africa, said its Tanzanian subsidiary, Williamson Diamonds (WDL), has since built an initial six-metre-high wall to close the breached wall area.
As a precautionary measure, WDL has also put up containment walls upstream and downstream of the New Alamasi water dam, while support for the facility’s new wall is under way.
Various diversion trenches are also being constructed to prevent any build-up of water and to enable rainwater to flow into the surrounding rivers and streams, Petra said.
Up to one-year wait
In a preliminary assessment, independent and Petra specialists concluded that the failure was the result of a subsidence of a portion of the TSF’s east wall measuring around 1.5 metres. This enabled water to crest the wall, initiating the breach.
“The root cause of the subsidence has not been determined and will require a forensic geotechnical investigation to be completed,” Petra said.
“This work will be undertaken by an independent company specializing in tailings dam design and management,” it added.
Cost and timing of the investigation will be available after a detailed scoping process is completed, but the miner said initial estimates point to between six and 12 months.
The company said that in light of the failure of the existing facility, the design of the new TSF is currently under review, which is expected to be finalized in February 2023.
Petra warned the new TSF will take longer than initially anticipated to become operable. In parallel, an option of repairing and using the existing TSF is also being explored as a long-term solution, but this is subject to the outcome of the geotechnical investigation.
Financial support
Petra said it was in talks with the government of Tanzania on options for financial support during the production halt. Petra owns 75% of Williamson, with the government owning 25%.
One of the options proposed by the company is the release and sale of a 71,654-carat diamond parcel seized by Tanzanian authorities in 2017.
At the time, Petra had to halt operations at Williamson, the source of the confiscated diamonds, as local authorities claimed the company was undervaluing its exports, which the miner has denied.
The Williamson mine has been the target of illegal artisanal miners in the past. Image courtesy of RAID
The two parties reached an agreement in December 2021, with the Tanzania government accepting to release the proceeds of the parcel sale to the company.
Operations at Williamson were halted for months last year due to a decline in diamond prices. During this time, the mine was subject to numerous incidents of illegal mining, and accusations of human rights abuses by security guards trying to keep intruders at bay.
Petra investigated the claims and reached a $6 million settlement.
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