ASX-listed Lucapa Diamond Company has paused work on a feasibility study into its Merlin diamond project, in Australia's Northern Territory, to assess the potential development of a smaller-scale, lower-cost alternative path to development.
The diamond miner, which also holds an interest in the Lulo and Mothae mines, in Angola and Lesotho, respectively, states that, in light of the current capital market environment and softening of diamond prices this year, it is prudent to pause the feasibility study on the Merlin project and consider lower production and capital cost options.
The alternate study, which is already well advanced, will examine, among other things, using existing resources, such as the trial mining plant and front-end scrubber, to get Merlin into production.
The diamond miner expects to finalise the capital and operating estimates for the smaller-scale development during 2024.
“Lucapa is in the fortunate position to be debt-free and have two profitable producing mines. For the next 12 months, we will focus on further strengthening our balance sheet.
"Rather than raise capital to fund the original Merlin development, we will focus on a lower-cost pathway to development using existing resources," Lucapa MD Nick Selby says.