JOHANNESBURG (miningweekly.com) – Development at JSE- and Aim-listed DiamondCorp’s Lace mine, in the Free State, remains on schedule and within budget to start production during the first half of 2015.

“The period under review saw us complete the finance package and start development of the underground mine at Lace. The mine is expected to produce up to 500 000 ct of diamonds a year for more than 25 years, starting in the first half of 2015, and heralds the transition of DiamondCorp from explorer to diamond producer,” DiamondCorp CEO Paul Loudon commented on Monday. 

The company, which reported a £2.2-million net loss for the six months ended June 30, noted that the 1.2-million-ton-a-year Lace diamond recovery plant was also refurbished during the six months, and was successfully commissioned after period end.

The retreatment of more than three-million tons of tailings that remained on site had restarted and the preparation of the marketing and sale of the first 5 000 ct of tailings diamonds was under way.

Further, Loudon stated that the period also marked the start of a long-term association with Tiffany & Co, which allowed the jewellery retailer access to a new supply of diamonds that met its quality standards and allowed for increased traceability from source to end-user.

DiamondCorp finalised a R320-million finance package for the 47-level block cave development at the Lace mine, in January, when it entered into a loan agreement with Tiffany & Co subsidiary Laurelton Diamonds for $6-million.

The Tiffany loan was drawn down in two equal tranches in January and April.

From the proceeds of the Tiffany loan and the R59.7-million convertible bond issue completed in December last year, R100-million was issued to DiamondCorp’s 74%-owned subsidiary Lace Diamond Mines (LDM).

These funds allowed LDM to meet the initial drawdown conditions of a R220-million project loan agreement with the Industrial Development Corporation, of which the first R30-million tranche was drawn down in August.