Williamson Diamond Mine - History

History

The diamond industry of Tanzania in the 1930s was characterized by a scattering of very small mining operations that were insignificant in the economic makeup of the country. Dr. Williamson was hired by one of these operations, the Mabuki diamond mine, in 1938 and used it as his base for diamond prospecting in the region. In 1940 he discovered the Mwadui kimberlite pipe; over the next several years he developed the mine, although he was hindered by difficulty in procuring equipment and raising funds due to World War II. By the 1950s he had developed the Williamson diamond mine into the first significant diamond mine in Tanzania, with state-of-the-art equipment and a labor force of several thousand. The mine was noted for numerous technical innovations in diamond mining which were developed under Williamson's watch. Williamson closely managed the mine until his death in 1958 at the age of 50.

Williamson's heirs sold the mine for about £4 million GBP to an equal partnership between De Beers and the colonial government of Tanganyika on August 13, 1958. In 1971, a decade after Tanzania's independence, the government nationalized the mine. Although details are unknown, De Beers and other diamond industry players speculate that mine performance deteriorated significantly in the 1980s under government management. Suspected causes of this are a decrease in ore grade as the mine's richer deposits were worked out, loss of skilled foreign management and engineering staff, a bloated labor force resulting from government employment efforts, and inadequate capital investment in the mine's equipment. Perhaps as a result of this poor performance, Tanzania invited De Beers to purchase back into the mine, which the company decided to do. In 1994 De Beers bought 75% of the Williamson mine, with Tanzania retaining the remaining shares.

Since 1994, De Beers has acted to improve the performance of the Williamson diamond mine by trimming work force, making needed capital investments in equipment, and bringing in expertise in technology, technique, and exploration. Although the mine is still viewed as a marginal performer due to its low ore grade, De Beers has identified several possible avenues for development that would keep the mine operating well into the future.