| Tue 17 Apr 2012, 14:30 | | RDI - Rockwell - Provides a strategic and production update and announces |
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RDI
RDI
RDI - Rockwell - Provides a strategic and production update and announces
appointment to the board
Rockwell Diamonds Incorporated
(A company incorporated in accordance with the laws of British Columbia, Canada)
(Incorporation number BCO354545)
(Formerly Rockwell Ventures Inc.)
(South African registration number: 2007/031582/10)
Share code on the JSE Limited: RDI ISIN: CA77434W1032
Share code on the TSX: RDI CUSIP Number:77434W103
Share code on the OTCBB: RDIAF
Rockwell provides a strategic and production update and announces appointment to
the board
April 17, 2012 Vancouver, BC - Rockwell Diamonds Inc. ("Rockwell" or the
"Company") (TSX: RDI; JSE: RDI; OTCBB: RDIAF) provides an update on strategic
and operational progress for the fourth quarter of fiscal 2012 and announces the
appointment of a new non-executive director, further strengthening its Board of
Directors.
Strategy update:
The recent agreement reached with Africa Vanguard Resources to unwind the 2008
deal to purchase a 26% holding in Rockwell`s Northern Cape operations was a
strategic milestone for the Company. It will leave Africa Vanguard Resources
with an 8% holding in the Company at the JSE-listed level and paves the way for
Rockwell to bring in additional black economic empowerment ("BEE") business
partners at the different operating levels and business units ensuring it
remains compliant with the South African Mining Charter. The Company is in
active discussions with several BEE entities that are in a position to fund
their shareholding as well as their share of future and planned investments,
supporting Rockwell`s funding requirements to grow the Company`s production
profile.
In addition, the Jasper Mine, which was purchased as part of this transaction,
adds additional exploration potential to the Saxendrift Mine which is expected
to extend the life of the operation. The transaction is anticipated to close at
the end of May 2012 and is subject to a due diligence that has already
commenced. Exploration at the Jasper site is planned to start in July 2012.
The completion of these transactions is subject to various conditions precedent,
including the completion by Rockwell of the due diligence investigation,
regulatory approvals and obtaining approval from the DMR with respect to certain
parts of the transaction.
Fourth quarter operational update:
The volume and carat production for the Company`s operations for the quarter
ended February 29, 2012:
Production volume (m3) Carats
Q4 2011 Q4 2012 % Q4 2011 Q4 2012 % change
change
Saxendri 289,540 409,348 41% 961 1,437 50%
ft
Tirisano 0 94,643 - 0 535 -
Klipdam 183,350 157,636 -14% 1,307 2,050 57%
Total 472,890 661,627 40% 2,268 4,022 77%
Saxendrift:
- Overall production volumes for the fourth quarter increased 41% year-on-
year. Record production volumes were achieved in February 2012 as a result
of continuous operations and significantly improved performance of the in-
field screen that was commissioned in November 2011.
- Year-on-year carat production increased 50% for the fourth quarter as a
direct result of the Company`s diamond value management initiatives
including the in-field screen as well as improved operational discipline
and efficiencies.
- Two new mining faces have also been opened up which will enable additional
operational flexibility and efficiencies.
- The bulk x-ray machine was commissioned at the supplier`s premises at the
end of February 2012. The equipment arrived on the Saxendrift site after
the end of the fourth quarter and the first gravel testing commenced on
schedule in mid-April 2012.
Tirisano:
- The ongoing ramp up to full production at the Tirisano Mine by the end of
July 2012 is being closely managed by the Rockwell executive team, in
conjunction with the recently appointed and highly experienced mine
management team.
- Disappointing grades for the fourth quarter have been addressed by a number
of technical interventions. The mine plan has been adjusted to increase
throughput and grades with early benefits emerging in the first weeks of
the new fiscal year.
- The Board has approved a capital investment project of approximately
$200,000 for the implementation of a wet front end. Construction commenced
in March 2012 and is scheduled for completion in May 2012 to enable full
commissioning and ramp up before the next rainy season (typically occurring
from November to January), eliminating the production delays that are
frequently associated with processing wet ores.
Klipdam:
- The decision to refocus mining on the Rooikoppie gravels during the third
quarter enabled the mine to achieve a significant increase in grade for the
fourth quarter. This also led to a 57% year-on-year improvement in carat
production at Klipdam.
- The system that was implemented to estimate revenue on rough diamonds as
they are recovered has positively influenced the mine plans and also
contributed to the production outperformance.
- Gravels from the Holpan Mine, which was closed in May 2011, are being
processed through the Klipdam plant to extend the life of this mine.
- The anticipated efficiency improvements as a result of erecting an infield
screen at the centre of mining activities are producing positive results.
"We had a reasonable fourth quarter and continue to make solid progress on our
strategic and turnaround projects. This is evidenced by our year-on-year
improvement in volume and carat production, of 40% and 77% respectively. Our
priority for the quarter was the continued implementation of fit-for-purpose
processing technology and active management of the mine plans at our three
operational mines to achieve our production improvements with a continued focus
on managing our costs," stated James Campbell, CEO, Rockwell. "The next set of
objectives that we have set ourselves is the commissioning and testing of the
bulk x-ray plant at Saxendrift and the ramp up of Tirisano, both of which should
impact positively on our business."
Looking forward, Campbell added that: "Having made solid progress in fine-tuning
our operations, we can now also start to focus on our medium to longer term
growth strategy. Of particular significance is the acquisition of the Jasper
Mine which is adjacent to Saxendrift and has the potential to extend the life of
this mine. Work on re-optimizing the feasibility study for the Wouterspan Mine
using later and more applicable technology will start once the results from the
Saxendrift bulk x-ray project are forthcoming."
Appointment to Board of Directors:
The Company also announced that it had further strengthened its board of
directors with the addition of Stephen Dietrich as an independent non-executive
director. Stephen will also join the audit committee. Based in South Africa,
Stephen is a CA(SA) and has more than twenty years of financial experience in
the diamond industry, gained in various positions at De Beers. He retired from
De Beers in 2009 at which time he held the position of Finance Director.
"We are delighted to welcome Stephen, who is a stalwart of the diamond industry,
to the board. His finance and diamond experience will undoubtedly complement the
experience and expertise of our board and we look forward to his contribution to
the Company," said Mark Bristow, Chairman, Rockwell. "This appointment fulfills
our stated objective of enlisting a strong board of directors that is capable of
supporting the already improved beefed-up management team in its strategy to
build and grow a value focused diamond business capable of delivering value for
its stakeholders."
Note:
Rockwell will report fiscal 2012 fourth quarter and annual financial results on
Thursday, May 24, 2012 after market close.
For further information on Rockwell and its operations in South Africa, please
contact
James Campbell CEO +27 (0)83 457 3724
Stephanie Leclercq Investor Relations +27 (0)83 307 7587
About Rockwell Diamonds:
Rockwell is engaged in the business of operating and developing alluvial diamond
deposits, with a goal to become a mid-tier diamond production company. The
Company has three existing operations, which it is progressively optimizing, two
development projects and a pipeline of earlier stage properties with future
development potential.
Rockwell also evaluates merger and acquisition opportunities which have the
potential to expand its mineral resources and production profile and would
provide accretive value to the Company.
No regulatory authority has approved or disapproved the information contained in
this news release.
Forward Looking Statements
Except for statements of historical fact, this news release contains certain
"forward-looking information" within the meaning of applicable securities law.
Forward-looking information is frequently characterized by words such as "plan",
"expect", "project", "intend", "believe", "anticipate", "estimate" and other
similar words, or statements that certain events or conditions "may" or "will"
occur. Although the Company believes the expectations expressed in such forward-
looking statements are based on reasonable assumptions, such statements are not
guarantees of future performance and actual results or developments may differ
materially from those in the forward-looking statements.
Factors that could cause actual results to differ materially from those in
forward-looking statements include uncertainties and costs related to
exploration and development activities, such as those related to determining
whether mineral resources exist on a property; uncertainties related to expected
production rates, timing of production and cash and total costs of production
and milling; uncertainties related to the ability to obtain necessary licenses,
permits, electricity, surface rights and title for development projects;
operating and technical difficulties in connection with mining development
activities; uncertainties related to the accuracy of our mineral resource
estimates and our estimates of future production and future cash and total costs
of production and diminishing quantities or grades if mineral resources;
uncertainties related to unexpected judicial or regulatory procedures or changes
in, and the effects of, the laws, regulations and government policies affecting
our mining operations; changes in general economic conditions, the financial
markets and the demand and market price for mineral commodities such and diesel
fuel, steel, concrete, electricity, and other forms of energy, mining equipment,
and fluctuations in exchange rates, particularly with respect to the value of
the US dollar, Canadian dollar and South African Rand; changes in accounting
policies and methods that we use to report our financial condition, including
uncertainties associated with critical accounting assumptions and estimates;
environmental issues and liabilities associated with mining and processing;
geopolitical uncertainty and political and economic instability in countries in
which we operate; and labour strikes, work stoppages, or other interruptions to,
or difficulties in, the employment of labour in markets in which we operate our
mines, or environmental hazards, industrial accidents or other events or
occurrences, including third party interference that interrupt operation of our
mines or development projects.
For further information on Rockwell, Investors should review Rockwell`s annual
Form 20-F filing with the United States Securities and Exchange Commission
www.sec.com and the Company`s home jurisdiction filings that are available at
www.sedar.com.
Canada
17 April 2012
Sasfin Capital
(a division of Sasfin Bank Limited)
Date: 17/04/2012 14:30:01 Produced by the JSE SENS Department.
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