Name of the Project
Lace diamond mine development project.

Location
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 of 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
DiamondCorp plans to sell 5 130 ct of diamonds recovered before the closure of the Lace mine while it works to bring the mine back into production.

The miner announced on November 14 this year that production at the mine had been halted after a flood at the mine. The company has, however, reported that its 310 m production level is now clear of flood water and its pumping system working normally.

The long-hole drill rig, which was operating at the time of the flood, has been moved to higher ground within the mine. Remediation of the access ramp has to be completed before it is brought to surface for dispatch to mining equipment manufacturer Sandvik to be rebuilt.

DiamondCorp, which has placed its LDM operating subsidiary into business rescue following the flood, is continuing discussions with its creditors.

LDM is also claiming against its insurance policy in respect of storm damage and remediation.

Further, Diamondcorp, along with PwC, is continuing to evaluate the group’s financial projections to determine the resultant additional capital required, should the business rescue proceedings be successfully concluded.

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.