In the media

DiamondCorp reaches development milestone at Lace

10 March 2011

Author: Loni Prinsloo

After a year of development activity at the Lace mine in South Africa, Aim-listed DiamondCorp announced on Tuesday that it had accessed the top of the first mining block at the diamond mine.

The company said in a statement that heavy rainfall during the past four months over the project area in the Free State had posed challenges for mine dewatering, waste hauling and drilling of a new ventilation raise, resulting in decline access to the kimberlite being about six weeks behind schedule.

However, CEO Paul Loudon told Mining Weekly Online that the company had a contingency plan in place to mitigate the effects of such challenges and curb possible budget overruns.

It was previously estimated that the full development cost of Lace mine would be about £8,5-million, but Loudon believed that costs would be north of that, owing to inflation and the rand strengthening since the estimate was done in November 2009.

To accurately determine project economics, DiamondCorp would take a 30 000 t bulk sample of kimberlite from the 260 m access point. Loudon said that the diamonds recovered from the sample would be indicative of the grade and value expected from the project.

DiamondCorp planned to process about 400 000 t of kimberlite during the development of the project, which would be sold to assist with development funding, said Loudon.

In preparation for processing the bulk sample of kimberlite, the company recommissioned the 1,2-million-ton-a-year dense media separation plant at Lace, remaining from mining activities, which took place between 1900 and 1931. “It is very exciting to start hauling and processing fresh kimberlite from the Lace mine for the first time since mining ceased in 1931,” commented Loudon.

DiamondCorp anticipated that the mining grade and carat value of the top of the first mining block of the estimated 33-million tons of kimberlite remaining below the old working areas at Lace would be known by mid-year, which would contain an indicated and inferred resource with an estimated 14-million carats of diamonds to the 855 m below surface level.

Full development would take about 17 months, said Loudon.

“With both current diamond prices and the long-term metrics for diamond market looking so strong, our timing looks good in terms of adding value for shareholders,” said Loudon.

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