Aim-listed BlueRock Diamonds has appointed mining services provider Teichmann South Africa, as a contract miner at its Kareevlei diamond mine, in the Kimberley region of South Africa.
The five-year contract is effective July 1.
BlueRock announced in May that it was in negotiations with a member of the Teichmann Group to provide the quantity of ore necessary to meet BlueRock’s production plants’ needs.
Teichmann is a civil engineering and mining group with around 1 800 employees.
BlueRock expects Teichmann’s extensive experience in mining operations to significantly de-risk the company’s mining activities and allow for production targets to be met cost-effectively.
Teichmann will be responsible for extracting ore; breaking ore down to the required size, where required; and delivering ore to BlueRock’s processing plant.
BlueRock says Teichmann will be paid almost entirely on a cost-per-tonne basis, unlike the prior service provider, which was paid on an hourly basis with a minimum number of hours guaranteed.
Based on BlueRock’s lower end of current production expectations, the estimated cost of Teichmann’s services for the financial year ending June 30, 2020, will be about R21-million, or £1.1-million.