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Lace mine development bruised, but not halted by AMCU strike

Lace mine

Lace mine

30th October 2014

By: Natalie Greve

Creamer Media Contributing Editor Online

  

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JOHANNESBURG (miningweekly.com) – Development work and tailings retreatment activities at Southern African diamond developer and explorer DiamondCorp’s Lace diamond mine, in the Free State, is continuing despite a protected strike by members of the Association of Mineworkers and Construction Union (AMCU), which is nearing the end of its first week.

AMCU workers downed tools on October 23 under the ‘no work, no pay’ rule over management's refusal to employ two full-time salaried shop stewards.

“Until such time as the strike ends, development tunnelling in the UK4 mining block and processing of development kimberlite will continue with non-AMCU members.

“The first week of the strike has highlighted certain workplace inefficiencies, which will be investigated and addressed when the striking workers return,” the company said in a statement on Thursday.

Year-to-date productivity on development tunnelling prior to the strike action was 1.57 t per person per shift with three crews, while productivity since the strike started was 2.87 t per person per shift with one crew – an improvement of 87% per person. 

However, the company estimated that, for every two weeks the strike continued, around one week would be added to the development timetable.

“Installation of the underground conveyor belt is unaffected by the strike action and is scheduled to be commissioned in the first half of next year – in time for mining of the UK4 block,” said the group.

Tunnel development costs, to date, were averaging R39 135/m against a revised budget of R37 000/m, with the overspend the result of increased operating costs
on the company’s underground mining fleet.

“However, cost saving initiatives, including the introduction of chains to the tyres of the underground loaders and computerisation of maintenance scheduling, are starting to show a positive impact, which should be reflected in improvements in the cost per metre rate going forward. The overall mine development expenditure is within budget,” DiamondCorp outlined.

TAILINGS RETREATMENT
In the three months ended September 30, a decision was taken to stop tailings retreatment processing to allow the surface earthmoving fleet to complete the construction of another 150 000 m3 surface process water storage dam in preparation for earlier-than-scheduled kimberlite mining.

This was successfully completed ahead of the summer rains.

Water pumped from underground provided around 55% of the Lace processing plant requirement, with the balance coming from surface rainwater runoff. 

All final modifications to the plant had, meanwhile, been completed for treatment of development kimberlite from the UK4 block, which was now being trucked to surface. 

DIAMOND SALES
Diamond sales for the nine months ended September 30 totalled 16 505 ct for proceeds of $1.07-million, while the average year-to-date sales price of $65/ct was 5% above the forecast for the year. 

“The 15.2 ct diamond recovered from the dumps in July was sold into the company’s Johannesburg beneficiation joint venture at $5 000/ct. The stone yielded two brilliant cut diamonds of 5.33 ct and 2.07 ct, which are currently awaiting sale. The company will receive 50% of the profit from the sales of the polished gems,” it noted.

DiamondCorp added that short-term demand for rough diamonds had softened in response to slower polished sales and tightening liquidity as a number of banks that financed the cutting and polishing sector had moved to reduce their exposure to the sector.

“[In the] longer term, the outlook remains strong as world economies continue to recover,” the company concluded.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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