• January 23rd, 2020

Debmarine secures financing for new N$7 billion mining vessel

WINDHOEK – Debmarine Namibia yesterday confirmed financing for its brand-new N$7 billion (US$468 million) state-of-the-art mining vessel being built in Romania. While Debmarine Namibia will cover N$1.4 billion of the construction costs from its own coffers, which constitutes 20 percent of this massive investment, five commercial banks have agreed to finance 80 percent of the deal, which equates to approximately N$5.6 billion (US$375 million). 

The five commercial banks are Standard Bank Namibia, Rand Merchant Bank (RMB) Namibia, Nedbank Namibia, Bank Windhoek and ABSA Bank in neighbouring South Africa. Being constructed by Dutch shipbuilder, Damen Shipyards, the vessel, currently only known as the AMV3, represents the largest-ever investment in the global history of marine diamond recovery and is expected to commence operations in 2022. 

When combined with Debmarine’s multi-billion investment in its mv SS Nujoma exploration vessel about four years ago, the marine diamond miner would have invested over N$10 billion and created over 300 permanent jobs when the new vessel takes to the seas in 2022. 

“The investment in the AMV3 is a culmination of a dream, a realisation of a vision, a dream that started nine years ago. So, it must not be seen in isolation. It is in fact part of the investment that Debmarine Namibia made in the mv SS Nujoma four years ago. The SS Nujoma was the enabler for the AMV3,” explained Debmarine Namibia’s chief executive officer, Otto Shikongo, at the financing announcement yesterday. 

During an earlier interview, Shikongo noted that Damen Shipyards was selected to build the new vessel based on their impressive track record for delivering quality vessels and their advanced technological capabilities. The new vessel will incorporate the latest marine technologies that will drive improved safety performance while optimising efficiency and utilisation rates.

The financing deal is one of the largest commercial transactions to be concluded in the country this year. According to the bankers, their willingness to finance the vessel signals their confidence in Debmarine Namibia’s leadership and business plan, and the financiers encouraged the investment which they said will significantly contribute to the domestic economy through gross domestic product contribution, boosting export earnings and creating much-needed employment. 

According to Debmarine’s chief financial officer, Willy Mertens, the US dollar-denominated loan will be paid back in five years, combined of course, with a US dollar-based interest rate. 

During its first five years of production the new vessel is expected to produce 500 000 carats per annum, which is a 35 percent increase on the company’s current production figures. The AMV3 is also expected to contribute about N$2 billion per annum in taxes and royalties and will create more than 160 jobs alongside Debmarine’s current workforce of 1 000 employees. 

The new vessel will be the seventh addition to the Debmarine Namibia fleet, which currently comprises five diamond recovery vessels and one exploration and sampling vessel. 

Edgar Brandt
2019-06-20 09:41:16 | 7 months ago

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