Lesotho's Biggest Diamond Mine Halts Operations
June 03, 26
(IDEX Online) - The Kao diamond mine, in Lesotho, is to halt operations at the end of this month.
Loss-making operators Storm Mountain blames a slump in sales, together with a crippling rise in fuel prices as a result of conflict in the Middle East.
It also said growing competition from lab growns and mounting capital requirements were making it impossible to continue operations.
Last October Storm Mountain warned that Lesotho's biggest diamond mine could close unless it found $13 million in new investment.
"The biggest challenge confronting the operation was the prolonged, severe decline in global rough-diamond prices," said Storm Mountain CEO Neo Hoala.
Mining at Kao, the largest kimberlite pipe in Lesotho, wil cease on 30 June and the mine will be placed on care and maintenance, pending management reviews. Around 750 workers have been affected.
Storm Mountain sold around 250,000 carats in 2024, generating $50 million in sales - less than half of its 2022 revenue of $105 million.
News of the suspension at Kao follows Ekati, in Canada, filing for insolvency protection, Ekapa, in South Africa, halting operations and being put up for sale and Petra closing its Finsch mine, also in South Africa.