In the media

Development Starts at Lace, First Stones from Kimberlite Expected in Q3’14

24 January 2013

Source: www.oceanequities.co.uk

News

DiamondCorp Plc has announced that it has commenced development at its Lace diamond mine in South Africa. Work will now begin on a box cut for the conveyor system, blasting for the ventilation raise, upgrading the recovery plant and mechanical work on the mine fleet. Staff levels have been brought up to 75 on site, which will allow DiamondCorp to get the early stage work up to full speed.

Currently DiamondCorp has £5.5m cash in the bank, with a further $3m from the second tranche of the Tiffany loan expected in the Company’s accounts on 10th April 2013. A larger loan facility of R220m (£15.6m) has been agreed with the Industrial Development Corporation and will be drawn down once the Tiffany loan capital has been employed. The total funding package for the Lace mine of £23m exceeds the peak funding requirement of £20.3m.

Near term objectives

With a workforce of 75 already on site DiamondCorp has been able to start work on four major development projects simultaneously. Development of a 66,000m3 box cut has commenced. The box cut is for the 2.6km twin conveyor system that will bring ore to surface. DiamondCorp elected to use a conveyor rather than a hoisting system as the maximum energy requirement is considerably lower.

Blasting will soon start for a ventilation raise. DiamondCorp is developing a raise to Level 16 providing interim ventilation while other development is underway. DiamondCorp will also soon start work on a tipping arrangement on Level 24. This will allow the company to tip waste material from the twin decline development to then be brought to surface by low profile dump trucks.

Work has already begun on upgrading the dense media separation (DMS) plant at Lace as DMS capacity at Lace was not quite sufficient to meet the need of ths full scale, 1.2Mtpa operation. Once upgrades to the DMS are complete DiamondCorp can restart tailings processing, expected in Q2’13. The mining fleet is also being rehabilitated and work is underway to rebuild another underground loader as well as two dump trucks.

Lace bulge area

In addition to the development work underway, DiamondCorp will also carry out a small scale definition drilling campaign on the “bulge” area of the Lace kimberlite pipe. The area has been known about for some time and it is possible that DiamondCorp could define additional kimberlite resource in the area. Currently the main pipe at Lace has a resource of 33Mt at an average grade of 40cpht for a total of 13.4Mcts.

Comment

Today’s announcement marks DiamondCorp’s transition from explorer to developer, a transition facilitated by a non-dilutive financing package underpinned by an off-take backed loan agreement with Tiffany & Co. The focus for the Company has to now be meeting its development targets and bringing the mine on-line on-schedule. DiamondCorp has set itself a deadline of diamond recovery from fresh kimberlite processing in Q3’14.

Useful links

Mining news links sites

Mineweb
Mineweb is a web-based international mining publication focusing on mining financial and corporate news and comment.
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Miningmx
Miningmx is a new online mining media enterprise, a publication held in joint venture with Finance Week, a business unit of Media 24 which is, in turn, a division of South Africa’s largest media group, the US-listed Naspers Limited.
www.miningmx.com
Minesite
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www.minesite.com
Resource Investor
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www.resourceinvestor.com



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