Ekati Diamond Mine and the Diavik Diamond Mine continued to perform wellDecember 14, 14
The Ekati mine.
Rough diamond production and sales all exceeded plan, and the company recorded a third quarter consolidated net income attributable to shareholders of $25.5 million. For the nine months ended October 31, consolidated net income attributable to shareholders totaled $66.7 million.
Brendan Bell, Acting Chief Executive Officer stated: "While we continue to focus on the strategic development of our future resources, we are also taking a very disciplined approach to executing on our current mine plan. This disciplined approach is apparent in these strong results."
The miner said that U.S. market for diamond jewelry represents 40 percent of global consumption and "anecdotal evidence of sales in the important fourth calendar quarter has been very encouraging. Underlying demand for wedding jewelry on Mainland China remains strong. However the overall macro-economic challenges facing both China and Japan have dampened market expectations. Rough diamond prices moderated during the quarter but the company's average rough diamond prices remained approximately 4 percent higher to the end of the third fiscal quarter.
"The company continues to deliver enhanced value from its world class diamond mines, the Ekati Diamond Mine (in which the company owns an 88.9 percent interest) and the Diavik Diamond Mine (in which the company owns a 40 percent interest).
Diamond production at the Ekati Diamond Mine continued to exceed plan, driven by both higher than expected grades and operational improvements to the processing plant, Dominion said.
The company estimates that process plant improvements to date at the Ekati Diamond Mine have increased the recovered grade during the nine months ended October 31 by approximately 15 percent compared to the mine plan. The resulting additional diamonds are not currently included in the company's reserve statement and mine plan, and are therefore incremental to production. During the quarter, physical modifications to the plant were substantially completed with commissioning expected to take place before the company's fiscal year-end. Once the process improvements have been completed, Dominion intends to incorporate these higher recovery rates into an updated reserve statement.
Stripping at the Misery pipe pushback is proceeding according to plan. A total of approximately $100 million of capital expenditure remains to be spent before the first ore from the Misery Main pipe, estimated at 4.0 carats per tonne and $105 per carat (as of January 31, 2014), is put through the processing plant in early calendar 2016.
On November 6, 2014, Dominion filed the Developers Assessment Report (DAR) for the Jay Project and it anticipates a ministerial decision late next year. Once the decision is issued, the water license and land-use permitting process will take approximately a further six months. The Jay Project, which features the open pit development of the largest diamondiferous resource in North America, has the potential to extend the operating life of the Ekati Diamond Mine by a further 10 years beyond the currently scheduled closure in 2019. Through the nine months ended October 31, the company has expensed $22.9 million on the project.
Dominion said it has a strong balance sheet and is well-funded to achieve its growth objectives. As of October 3, it held total cash and cash equivalents of $401 million ($289 million of cash and $112 million of restricted cash).