[miningmx.com] – DIAMONDCORP said it would issue up to £4m worth of shares which, combined with cash flow from diamond sales, would finance the ramp-up of its Lace diamond project in South Africa’s Free State province.
The company had also received formal approval from the Industrial Development Corporation (IDC) that it reschedule a loan that, including capitalised interest, totaled R258m as of end-January 2016. The loan, including capitalised interest, would increase to approximately R311m by 1 February 2017, the company said.
The rescheduling of the loan, and requirement for further capital, is related to delays in building capacity at the Lace mine.
“As previously announced, in recent months underground tunnel development at the 290 metres level of the Lace mine had been proceeding slower than originally planned in fractured ground close to old workings and in heavily diluted low-grade K6 kimberlite,” said CEO Paul Loudon.
The company also experienced delays with the commissioning of a conveyor at the mine related to new restrictions imposed by the Department of Mineral Resources.
Tunnelling has resumed to normal rates and the conveyor was successfully commissioned as of mid-November, the company said.
The share placement will be through a book-build exercise with certain directors of the company indicating they would participate in the scheme.
