In the media

DiamondCorp begins Lace Mine development

24 January 2013

Source: www.diamonds.net

DiamondCorp commenced its development activities for the 47-level block cave at its Lace mine, following the receipt of $3 million in funding from Laurelton Diamonds, a subsidiary of Tiffany & Co. The junior miner will receive a second $3 million tranche on April 10 as part of its funding agreement with Tiffany. DiamondCorp stated that the Tiffany loan, combined with $6.6 million (GBP 4.2 million) of convertible bonds and $24.6 million (GBP 15.6 million) from the Industrial Development Corporation of South Africa, completed the Lace project financing package.

The main pipe at the Lace mine contains 33.1 million tonnes of kimberlite indicated and inferred to 855-meters depth, containing approximately 13.4 million carats in both resource categories at an average grade of 40.1 carats per hundred tonnes (cpht). The resource has an in-ground value in excess of $2 billion at $160 per carat, according to the company.

The SRK Independent Engineering Report from March 2012 estimated the total development cost at $42.6 million (GBP 27 million), with the first diamonds expected to be recovered in the third quarter of 2014. DiamondCorp anticipates about $47 million in revenue from the mine during the 43 months of development and before full production is achieved. The 1.2 million tonne per annum Lace mine is expected to produce more than 500,000 carats of diamonds per annum at peak production.

DiamondCorp's CEO, Paul Loudon, said, "We are delighted to be underway with the 47 block cave development, which will mark the transition of DiamondCorp from explorer to underground diamond producer. Diamond production from tailings re-treatment will recommence during second quarter, initially on one shift while the upgraded processing plant is re-commissioned. We will then have the capacity to ramp up to three shifts in the second half of the year if diamond prices strengthen for small goods."

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