DiamondCorp’s 2014 Diamond Sales Achieved $63 Per Carat
February 04, 15
(IDEX Online News) – Southern Africa diamond development company DiamondCorp reported that during the three months ended December 31, 2014, its 74-percent owned subsidiary, Lace Diamond Mines (Pty) Limited (LDM), continued to implement a revised underground development schedule and budget at the Lace diamond mine in the Free State of South Africa.
The company said its aim is to bring forward the ramp-up of commercial production from underground kimberlite mining by six months into late H1 2015. However, due to the six-week industrial action by members of the Association of Mineworkers and Construction Union (AMCU) in October and November 2014, production will commence in the second half of the year, which is still four months ahead of the original plan.
DiamondCorp reports that during the strike, a number of underground workplace inefficiencies were identified, which have since been addressed. Consequently, the company development production has improved 15 percent.
Diamond sales for the year ended December 31, 2014, totaled 21,700 carats for proceeds of $1,361,778. The average sales price was $63 per carat, slightly ahead of the forecast for the year. According to DiamondCorp, profit share on two diamonds that were beneficiated from a 15.2-carat stone recovered from tailings and the sale of fine diamonds added a further $58,544 to income for the year.
The company said it has not factored diamond price increases into its Lace project model since the 250-meter level bulk test diamonds were valued in 2012 at $160 per carat. Nonetheless, in light of the current market weakness, it is modeling the project at $150 per carat. At the current rand/dollar exchange rate, this gives cash operating margins of 81 percent on the project’s UK4 Block and 71 percent on the deposit overall.
In 2014, the company processed 308,047 tons of tailings and recovered 18,534 carats of diamonds at an average recovered grade of 5.96 carats per hundred tons (cpht), compared with a budget recovered grade of 5 cpht.
Underground core drilling of the UK4 Block continues to delineate significant volumes of K4 (high-grade) kimberlite above the 365-meter level. The drilling, bulk testing and release of an updated resource statement will now be completed early in the second quarter, rather than in the first quarter as previously planned.