JOHANNESBURG (miningweekly.com) – With trial mining, stockpiling and a new plant now completed, 18 months of hard work have come to fruition as Aim-listed diamond miner BlueRock Diamonds accelerates commercial production at its Kareevlei tenements, in the Northern Cape.
With a new £300 000 fully operational plant in commercial production, processing about 80 t/h of kimberlite, the recovery grades were expected to be in line with – if not higher than – the initial guidelines.
“Now that we have restarted production, we are revenue-generating again and expect to make our first sales since commissioning of the new plant, in the June auction,” said BlueRock CEO Riaan Visser in an update to shareholders on Tuesday.
The company aimed to initially operate one eight-hour shift a day to “fine-tune” the plant, which was upgraded from an initial output of 25 t/h, before implementing two shifts a day.
“While doubling our capacity and revenue potential, a second shift will only require a 30% increase in our workforce,” added BlueRock nonexecutive chairperson Paul Beck.
Meanwhile, the company had prepared for production by stockpiling 50 000 t – a three to four-month supply – of kimberlite from the K1 and K2 pipes to be processed once the upgrade of the plant was completed.
Following the introduction of a second shift at the mine, it would start evaluating options for exploiting the undeveloped K3, K4 or K5 pipes.
During trial mining, 575 ct were recovered and sold on tender through a Johannesburg-based tender house for an average price of $248/ct – 36% higher than anticipated.
“The objectives of the trial mining phase were to verify the reliability of the historic sampling data and to establish the revenue per carat based on current prices. We have concentrated on the K1 and K2 pipes,” Beck noted.
Meanwhile, the group narrowed its losses from £537 000 in 2013 to £430 000 in 2014 – effectively reflecting the cost of the trial mining phase – with BlueRock generating its first turnover of £65 000 in the year to December 2014.
At the end of December, BlueRock held a cash balance of £248 000.