Rio Tinto 'eyes Zimbabwe diamond boost'

A diamond firm in Zimbabwe which is majority owned by Rio Tinto says it hopes to raise output sharply at a mine in the south of the country.

A $300m (£207m) expansion of the 300,000-carat per year Murowa mine is being prepared, Reuters has reported.

Rio Tinto owns 78% of Murowa, and Rio Zim, a Zimbabwean-owned unit separated from Rio Tinto in 2004, owns the rest.

Now Murowa is talking to the government about its recent decision to ban all diamond sales from Zimbabwe.

Human rights groups had accused Zimbabwe's security forces of abuses in the poorly secured Marange diamond fields in the eastern part of the country, and had been pushing for a ban on the stones from the nation.

Last week, Zimbabwe's mines minister said the government would ban all diamond exports until issues with the Marange field - where it was alleged Zimbabwe's military were smuggling diamonds - were sorted out.

However, that has also hit the Murowa mine, which produced 124,000 carats last year, and is certified to export diamonds through what is known as the Kimberley Process Certification Scheme.

That is an international initiative to ensure trade in diamonds does not fund violence.

Now Zimbabwe is waiting for Kimberley certification of its Marange diamonds.

Kimberley monitor Abbey Chikane has now said that problems seen during a previous visit to Zimbabwe had been "adequately covered."

The Kimberley monitor will make his formal recommendation soon and if Zimbabwe gets the go-ahead to begin exporting diamonds again then the Murowa mine is set to ramp up production.

"We have reinvigorated our feasibility study for a major expansion," Neils Kristensen, Murowa chief executive, told Reuters.

"The expansion will increase production by a factor of 6 to 7 times and double jobs."

"That would push our capacity to 1.8 million carats per year of high quality production, which is predominantly gem."