Aim-listed BlueRock Diamonds notes in an operational and corporate activity that the results of the two-month test to determine the realistic capacity of the Kareevlei plant at the diamond mine in South Africa, which started in mid-October and was carried out with the assistance of mining and processing specialists, confirmed that production of just below 90 000 t a month is achievable, in line with previous guidance.

It adds that, of greater importance, has been the confirmation that the plant was not affected to any significant extent by wet weather experienced in October and November.

Replacement of the grids and other components in the plant should increase throughout and improve reliability and quality (size) of diamond production.

The company says mining was focused on the KV2 pit at Kareevlei. Ore mined was the highest in two years; however, the strip ratio decreased to 1 from 4.30 at the start of this year.

This should increase with further development work to be undertaken on KV1 and KV3, BlueRock notes.

The mining and processing activities are being reviewed with the assistance of independent specialists and will be used in the planning and budget process currently in progress.

A detailed cost review identified opportunities to reduce costs, and these are being implemented, as are enhanced security and supervision.

PRODUCTION AND MARKET

Diamond prices have reduced during the quarter, although this has been partially offset by higher production, albeit at a lower average grade. Development of KV1 is planned for the new year.

Production in October and November yielded an average grade of 4.4 carats per hundred tonnes, with the largest diamond recovered weighing 10.2 ct.

Historically, the board has updated the market upon the discovery of large diamonds with an indicative initial valuation of over $100 000. However, to reduce uncertainty about potential revenue and the value of tenders, it has revised company policy regarding announcements of diamonds and, going forward, will only announce diamonds which have realised in excess of $50 000 on tender.

There will be announcements for materially significant diamonds where appropriate, BlueRock outlines.

SECURITY

Security throughout the mine site has been enhanced with the introduction of an independent contractor. During November an attempted heist of diamonds, which were being transported from the mine to Kimberley, was intercepted.

There was no loss or injury to people, equipment or stock, BlueRock says.

OUTLOOK

BlueRock’s focus remains on improving the performance of the mine and the plant.

Adequate funding for the operations of both BlueRock Diamonds and Kareevlei Mining, and potential capital expenditure, is a priority and is being assessed in conjunction with the review of activities at the mine.

The company expects to provide an update on production for the 2023 full year in the first quarter.