JOHANNESBURG (miningweekly.com) – Vancouver-based Lucara Diamond Corp, which made history last month by unearthing the largest diamond the world has seen in a century, plans to spend between $15-million and $18-million on an additional large diamond recovery process at its Karowe mine, in Botswana.

The current process circuit has been designed to recover diamonds of up to 1 000 ct, but based on the recent recoveries of very large diamonds, and the expected continuation of recoveries of exceptionally large diamonds in the south lobe, Lucara said on Wednesday that it would integrate an additional large diamond recovery process.

Lucara recently unearthed a 1 111 ct diamond, which is second only to the 3 106 ct found in South Africa in 1905, as well as an 813 ct stone and a 374 ct stone. These diamonds were recovered from the prolific south lobe, which would be the company’s focus in 2016.

Lucara reported that the Karowe mine was forecast to treat between 2.2-million and 2.4-million tonnes of ore in 2016, producing about 350 000 ct of diamonds. Up to 60% of material would come from the south lobe. Karowe was forecast to mine between 13 t and 14 t of waste in the year.

The company has forecast diamond revenue of between $200-million and $220-million for 2016, which was in line with its forecast revenue for 2015. However, the 2016 forecast excluded the sale of high-value exceptional diamonds, including the large diamonds recently recovered.

“Although the company has recovered exceptionally high-value stones from the mine and is now focused on the high-value south lobe, it is unable to predict when these diamonds will be recovered and sold. The company, therefore, considers sales from these diamonds as additional revenue to the baseline $200-million to $220-million revenue forecast, which has the potential to significantly increase annual cash flows,” Lucara stated.

CEO William Lamb said last week that Lucara would want more than $60-million for its 1 111 ct diamond. The company has already rejected a $40-million offer for the diamond, newswire Bloomberg reports.

Lucara expected its cash costs to be between $33.5/t and $36.5/t of ore treated. This is an expected increase from the forecast operating cash costs for 2015, owing to investment in changes to the process plant facilities to improve large diamond recovery and to process harder material from deeper in the south lobe. Higher power costs and a consumer price index increase of about 4% in Botswana would also increase cash costs.

Meanwhile, Lucara also announced that it would stop semi-annual dividend payments in lieu of a quarterly dividend pay-out. The company would introduce a progressive dividend policy in 2016, with the aim of maintaining or increasing the Canadian dollar dividends per share paid each year on a quarterly basis. In 2016, the company planned to declare a yearly dividend of C$0.06 a share, which would be paid in four equal payments at the end of each financial quarter.

Lamb said that the progressive dividend policy was the result of Lucara delivering strong cash flows.