[miningmx.com] — DIAMONDCORP said on Monday it expected the development of its Lace project in the Free State to cost up to R126m.
Net capital cost estimates to reach full production range from R100m to R126m, depending on revenue from diamond sales during development.
The company has just completed a detailed review of full-scale mine development costs and estimated life of mine operating costs for the project near Kroonstad, where underground bulk sampling is underway.
“The Lace mine has the potential to be a significant cash generator for DiamondCorp, with more than 25 years of mine life,” said CEO Paul Loudon.
“At current strong diamond prices, the initial minimum operating margin is expected to be a robust 46%, rising to very high levels if the diamond grade improves with depth as forecast in the geological model,” Loudon said.
The 30,000 tonne bulk sample underway at Lace will determine the initial mining grade and carat value at the top of the first mining block.
About 400,000 tonnes of kimberlite is scheduled to be mined from stoping development during the 17 months of mine development through to November 2012, when full-scale commercial production is expected to be reached.
Diamond sales revenue from this kimberlite will contribute between R90m and R116m towards mine development costs, depending on grade and carat value.
