Petra Diamonds shares tumble 24 per cent on Tanzania export ban

 
Courtney Goldsmith
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Petra Diamonds has stopped operations at its Williamson mine (Source: Getty)

Shares in Petra Diamonds dropped as much as 24 per cent this morning after the firm said the Tanzanian government blocked the export of one of its diamond parcels.

Petra suspended its operations at its Williamson mine in Tanzania for health and safety reasons after certain key personnel were questioned amid a government probe of the country's diamond sector.

Shares in the FTSE 250 company were down 11.4 per cent to 79.7p at the time of writing.

Read more: Shares in Petra Diamonds lose their shine due to lower production

The parcel was blocked from export to Petra's marketing office in Antwerp, but the company said the grounds upon which the actions were taken "have not been formally made known to the company as yet".

The company said:

Petra confirms that all operations related to the mine are conducted in a transparent manner and in full compliance with legislation in Tanzania and the Kimberley Process.

The government has complete oversight of the diamonds produced at the mine, which are physically controlled by a number of different government representatives in conjunction with Petra from the point of recovery until the point of sale.

Petra added it was not responsible for the provisional valuation of diamond parcels from Williamson before they are exported to Antwerp.

The company valued the parcel of 71,654.45 carats at $14.8m (£11.2m), but the government over the weekend valued it at $29.5m and accused the firm of undervaluing exports.

Petra said it was "committed to engagement with the government in order to resolve this matter and ensure that the correct information is available to all parties".

"The company will be in a position to address any other concerns raised by the findings of the parliamentary investigation once it has received a copy of the report."

The Williamson mine is 25 per cent owned by the government of Tanzania.

Acacia Mining is also locked in a row with the government of Tanzania over exports.

Last week, the miner said the government's decision earlier this year to ban exports of gold and copper concentrate had impacted 35 per cent of its production, costing it $210m to date.

Read more: Shares in Petra Diamonds shine as the market stabilises

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