Name and Location
Lace diamond mine development project, Free State, South Africa.

Client
Lace Diamond Mines (LDM), a 74% subsidiary of DiamondCorp.

Project Description
The 1.2-million-tonne-a-year Lace mine is expected to produce more than 500 000 ct/y of diamonds at peak production.

The deposit will be mined using block-cave mining, with three caves planned over the 25-year life-of-mine on the 47, 67 and 85 levels at depths of 470 m, 670 m and 850 m respectively.

The kimberlite is open at depth, with a significant bulge between 250 m and 360 m. The kimberlite can potentially add additional tonnage and diamonds not currently included in the resource statement.

The Upper K4 (UK4) block is being mined using long hole open stoping, while development of the first block cave on the 50 m level continues.

Net Present Value/Internal Rate of Return
Not stated.

Value
The total development cost of the project, including working capital and a 15% contingency on capital and development costs, is estimated at R384-million.

Duration
The production ramp-up from the Upper K4 (UK4) block started in December 2015.

Latest Developments
Commercial mining at the Lace diamond mine has achieved the planned rate of 30 000 t/m from the first block of the 310 m level of the UK4 block after a successful restart in July. The operation will deliver its first full month of commercial production and processing of kimberlite mining in August after a fall-of-ground accident in a development tunnel caused a two-week shutdown in July.

From March to July, the company mined 25 103 t from the west slot between the 290 m and 310 m levels, which provided the open space for blasting of through material currently being mined. The west slot is positioned on the contact between the high-grade K4 kimberlite and lower-grade K8 and K6 material, which will mostly not be exploited by the mining method being used for the UK4 block.

About 40% of the tonnes mined during slot development is low-grade material, which had to be moved ahead of commercial mining that started in the high-grade block. Total diamonds recovered from the slot material was 4 601 ct.

Monthly diamond sales is set to start in Antwerp, Belgium, at the end of August, with 7 000 ct of diamonds recovered from the mining of the west slot between and from tailings retreatment operations currently being exported. Subsequent sales are forecast at between 9 000 ct and 12 000 ct, depending on monthly grade fluctuations.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
The project is on time.

Contact Details for Project Information
DiamondCorp, tel +44 20 3151 0970, fax +44 20 3151 0971 or email info@diamondcorp.plc.uk