London-listed Petra Diamonds Ltd (PDL.L) said it had received authorisation from the Tanzanian government to resume diamond exports and sales from the Williamson mine, lifting its shares from two-year lows. The company said the timing and process for the next diamond export to the company’s office in Antwerp and the sale would be finalised between the company and the government.
Petra said no resolution had been reached over the 71,654.45 carat shipment from the Williamson mine that was blocked for export this month. New laws and a crackdown on mining firms in Tanzania have slowed fresh investment in what has long been seen as one of Africa’s brightest mining prospects as firms assess the government’s efforts to secure a bigger take from the sector.
Tanzania passed three laws in July that, among other things, hike taxes on mineral exports, mandate a higher government stake in some mining operations and force the construction of local smelters to add more value to the country’s mining industry. The regulations aim to stamp out what President John Magufuli has called years of corrupt practices and tax evasion which he said has robbed the country of revenue from a sector accounting for about 4% of GDP.
On Sept.7, the government confiscated a consignment of diamonds from a mine majority-owned by Petra after accusing the firm of under-declaring the value of the stones by about half. Petra had denied the charge. Tanzania’s push for a higher stake in projects has affected the trading value of London-listed mining companies, such as Acacia (ACAA.L) and Shanta Gold (SHAN.L).