| Fri 10 Feb 2012, 12:00 | | DMC - DiamondCorp plc - Operations Update |
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DMC
DMC
DMC - DiamondCorp plc - Operations Update
DiamondCorp plc
JSE share code: DMC
AIM share code: DCP
ISIN: GB00B183ZC46
(Incorporated in England and Wales)
(Registration number 05400982)
(SA company registration number 2007/031444/10)
(`DiamondCorp` or `the Company`)
OPERATIONS UPDATE
DiamondCorp plc, the African diamond mine development and exploration
company, is pleased to provide an update on activities at the Lace mine in
South Africa and kimberlite exploration in Botswana.
LACE MINE
The Company advises that SA Diamond Exchange has undertaken a revaluation of
the 2,168 carats recovered from the bulk test at the Lace Mine last year and
estimated a price of $172 per carat in the current market. This represents
an 7.5 per cent increase from the $160 per carat valuation of the first
1,850 carats from the bulk test announced last October.
The increase in value is a reflection of slightly better overall diamond
quality in the final 318 carats, as well as a moderate firming of prices for
Lace diamonds since the market correction in September 2011.
In light of the prices for Lace diamonds, tailings retreatment has
recommenced on an initial single shift basis. This will be monitored over
the next 60 days to confirm that an increase to two shifts will generate a
positive contribution to cashflow.
In the meantime, SRK Consulting is on track this month to complete the
Independent Engineering Report on the 47 level block cave proposed for the
Lace mine. The SRK report is required to progress negotiations with several
potential project finance providers looking to finance the underground
development which is designed to mine 1.2 million tonnes of kimberlite and
produce up to 500,000 carats of diamonds per annum.
Construction of a new heavy equipment maintenance and rebuild workshop has
been completed and major rebuilds of the Lace mine underground mining fleet
have started in readiness for rapid re-commencement of underground
development once project finance is secured.
DiamondCorp is pleased to report the current group cash balance is
approximately GBP2 million with no debt, allowing project financing
negotiations to be undertaken in a considered manner.
BOTSWANA KIMBERLITE EXPLORATION
Preliminary results of kimberlite samples recovered from the five large
diameter (455mm) drill (LDD) holes undertaken on kimberlite J-01 are now
available.
The samples totalling 388.34 tonnes were processed through a modified
circuit on the 65tph dense media separation plant at the company`s Lace Mine
in South Africa. The circuit was modified specifically to treat the LDD
samples from Jwaneng. Each borehole was treated as a separate sample with
the plant being purged between samples. Each sample was spiked with tracers
to monitor plant performance. All tracers were recovered.
A total of two macro diamonds (diamonds larger than 0.5mm in size) totalling
0.114 carats have been recovered to date.
In light of the low recovered grades from both J-01 and the previously low
recoveries announced from J-05, DiamondCorp has decided not to proceed with
further exploration on this property and will hand all rights back to the
tenement holder Geoperspectives (Pty) Limited.
Commenting on the results, DiamondCorp`s managing director Paul Loudon said:
"Despite being located near to the richest diamond mine in the world and the
encouraging mineral chemistry displayed by these kimberlites, mini bulk
tests suggest they do not contain macrodiamond grades sufficient to support
a large-scale commercial diamond mine.
Management remain in active discussion with numerous parties regarding
additional kimberlite projects in Botswana and other diamondiferous regions
of southern Africa."
London
10 February 2012
The Competent Person responsible for the technical information contained in
this announcement is Mr Paul Zweistra (Pr. Sci. Nat., Registration number
400016/93) a full-time employee of VP3. VP3 and Mr Zweistra have given
their permission for their work to be quoted in this announcement and have
reviewed the information contained herein.
AIM Nomad: Fairfax I.S. plc
AIM Brokers: Fairfax I.S. plc, Ocean Equities Ltd
JSE Sponsor: PSG Capital (Pty) Limited
DiamondCorp plc, Paul Loudon +44 20 3151 0970/+27 56 212 2308
Ewan Leggat/Laura Littley, Fairfax I.S. plc +44 207 598 5368
Guy Wilkes, Ocean Equities Limited +44 207 786 4370
John-Paul Dicks, PSG Capital (Pty) Limited +27 21 887 9602
Charmane Russell/Marion Brower, Russell & Associates +27 11 880 3924
Date: 10/02/2012 12:00:02 Produced by the JSE SENS Department.
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