REG-Petra Diamonds: Sale of Exploration Assets in Botswana

Petra DiamondsAnnouncement

20/07/2020 07:05

20 July 2020   LSE: PDL 

Petra Diamonds Limited

("Petra" or the "Company" or the “Group”)

Sale of Exploration Assets in Botswana

Petra Diamonds Limited announces that it has entered into an agreement to
dispose of its exploration assets in Botswana via the sale of 100% of its
holding in Sekaka Diamonds Exploration (Pty) Limited (previously known as
Petra Diamonds Botswana (Pty) Limited) (“Sekaka Diamonds”) to Botswana
Diamonds PLC (“Botswana Diamonds”) for a total consideration of US$300,000
and a 5% royalty on future diamond revenues should any of the prospects within
the exploration licences be brought into production. 

The assets of Sekaka Diamonds include the Company’s three existing
Prospecting Licenses in Botswana, which includes the KX36 project, a 3.5
hectare kimberlite that was a new discovery by Petra in 2010, as well as a
bulk sampling plant.  These assets have been classified as 'Assets held for
sale' since 30 June 2018 following a decision by the Board to dispose of its
Botswana exploration assets; the transaction is not a result of the recent
sales process announced on 26 June 2020.

The purchase price of US$300,000 will be payable in two equal instalments of
US$150,000 each, on or before 31 August 2021 and 31 August 2022 respectively.
Petra is also entitled to a 5% royalty on the sale of diamonds commercially
produced from any kimberlite which falls within the licence areas covered in
the sale. Botswana Diamonds has the option to buy-out the royalty for a cash
payment of US$2 million.  

The sale is subject to a number of regulatory approvals, including Ministerial
consent in Botswana, approval from Petra’s lenders and noteholders and, to
the extent required, approval from the Botswana Competition Commission. The
long-stop date for fulfilment of the Conditions Precedent is 31 August 2020,
which may be extended by mutual agreement of the two parties.

Richard Duffy, Chief Executive of Petra, commented:

“This disposal forms part of our strategy to focus on driving efficiencies
from our high quality producing mines, but allows us to maintain upside to
potential future commercial production from the Botswana assets, particularly
from the KX36 deposit. We wish Botswana Diamonds well with their exciting
exploration programme in Botswana and look forward to following their
progress.”

This Disposal constitutes a Class 2 transaction for the purposes of the UK
Listing Rules and further required disclosures are below:

                                                        US$ million  
 Sekaka Diamonds Gross Assets         31 December 2019  0.6          
 Petra Gross Assets                   31 December 2019  1,291.7      
 Sekaka Diamonds Net loss before tax  FY 2019           1.6          
 Petra Net loss before tax            FY 2019           254.0        

Petra plans to apply the proceeds of the sale to general working capital
purposes.

~ Ends ~

For further information, please contact:

Petra Diamonds,
London                                        
Telephone: +44 20 7494 8203

Cathy
Malins                                                  
            investorrelations@petradiamonds.com

Des Kilalea     

Marianna Bowes 
                                                      

About Petra Diamonds Limited

Petra Diamonds is a leading independent diamond mining group and a consistent
supplier of gem quality rough diamonds to the international market. The
Company has a diversified portfolio incorporating interests in three
underground producing mines in South Africa (Finsch, Cullinan and
Koffiefontein) and one open pit producing mine in Tanzania (Williamson).

Petra's strategy is to focus on value rather than volume production by
optimising recoveries from its high-quality asset base in order to maximise
their efficiency and profitability. The Group has a significant resource base
of ca. 250 million carats, which supports the potential for long-life
operations.

Petra conducts all operations according to the highest ethical standards and
will only operate in countries which are members of the Kimberley Process. The
Company aims to generate tangible value for each of its stakeholders, thereby
contributing to the socio-economic development of its host countries and
supporting long-term sustainable operations to the benefit of its employees,
partners and communities.

Petra is quoted with a premium listing on the Main Market of the London Stock
Exchange under the ticker 'PDL' and is a constituent of the FTSE4Good Index.
The Company’s US$650 million loan notes due in 2022 are listed on the Global
Exchange market of the Irish Stock Exchange. For more information, visit
www.petradiamonds.com.



Copyright (c) 2020 PR Newswire Association,LLC. All Rights Reserved