The Kimberley Process, a UN-backed initiative, ensures that all of Endiama’s diamonds confirm to international regulations

The challenges of developing Angola’s diamond industry are too complex for any one single company to meet. To create specialized business units with designated domains of expertise, Endiama has overhauled its corporate structure to become a group of independent companies.
Endiama Prospecção & Produção (Endiama Prospecting & Production, EP&P), formed in 2003, has the responsibility to explore and exploit diamond resources for the larger Endiama group. In an enterprise that generally relies on forming partnerships with international firms to develop mining projects, EP&P acts independently to identify and pursue strategic production opportunities. The Camuanzanza mine, which produced its first lot of 15,000 carats of diamonds in 2005, is one of EP&P’s major projects. Located in diamond-rich Lunda Norte province, the mine covers 206 square miles and encompasses over 91 million cubic feet of material. EP&P believes that some 890,000 carats of diamonds lie beneath the site, and that the company can produce between 12,000 and 15,000 carats a month.

EP&P is also responsible for finding diamond deposits, and researching the technical and economic feasibility of mining them. The hunt for additional diamond deposits will require more data and more expertise to identify new diamond-bearing sites. After years of armed conflict, much of the geological knowledge about Angola’s diamond-rich areas was presumed to be lost. EP&P is burrowing in the archives of Diamang (the former state producer) in Lisbon and the Center for Geological Sciences in Pretoria to follow up on previous exploration efforts, as part of a broader effort to quantify Angola’s diamond reserves and plan their development.

Sociedade de Comercialização de Diamantes de Angola (the Angolan Diamond Marketing Company, Sodiam) was created in 1999 to simplify the country’s diamond marketing structure and increase the presence of Angolan diamonds on the world market. Sodiam is also responsible for pursuing value-added activities so that Angola can move up the chain, from producing large volumes of rough diamonds to cutting and polishing them within the country.

The push for vertical integration is transforming the worldwide diamond industry, and Sodiam has partnered with Israeli diamond maverick Lev Leviev and other local partners to build a diamond cutting and polishing facility in Luanda. The $10 million factory, the largest such center in Africa, will eventually employ 600 Angolans who are currently being trained at Leviev Group facilities in Namibia and South Africa. Dr. Manuel Calado, Chairman of Endiama, says that it took a real effort to find potential partners and convince them that Angolans could polish diamonds as well as produce them. “It was practically through stubbornness that we built our first cutting and polishing factory here, and today it’s working well. We want to transform Angola into a real diamond market.”

In 2003 and 2006, Sodiam’s role was expanded and updated to accommodate the reality of the Angolan diamond sector, which includes a large informal component. To bring a measure of order to the sometimes rough-and-tumble world of informal diamond prospecting, Sodiam was designated the “Single Channel” to market all of Angola’s diamond output – buying from the formal mining companies as well as the informal miners, known as garimpeiros, who dig pits and sift riverbank gravel by hand. Sodiam operates a centralized buying room in Luanda, and markets the rough gems at its marketing centers in traditional hubs of the diamond trade in Europe, the Middle East, Asia, and North America.

Enditrade Logística Integrada and Trading (Enditrade Integrated Logistics and Trading) was set up in 2003 to supply Endiama’s operations and move diamonds from mines to processing centers. The company supplies an average of 1.3 million gallons of diesel a month to Endiama’s far-flung mining projects, and operates a fleet of 120 vehicles as part of its logistics and transportation activities. Today, Enditrade is diversifying, building on the expertise gained from equipping Endiama’s mines with heavy machinery and fuels.

Enditrade has several joint ventures underway, including a project with Sonangol, the Angolan oil group, to produce lubricants, and another with South African machinery manufacturer Bell to produce heavy equipment. In a country where key transportation links are undergoing significant reconstruction and expansion, Enditrade’s logistics experience is in high demand. The company is building a central pipeline for supplies, providing logistics and procurement support to leading international firms in Luanda. In a joint venture with British mining giant Lonmin, Enditrade is building a $9 million “dry port” in Luanda. Located near the country’s largest port, major highways, and a planned new airport, the logistics center will provide a secure and modern container handling facility so that shipments into and out of the country can rapidly clear customs.