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Lucara aims deeper

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Lucara aims deeper

Karowe Mine moves a step closer to underground operations

Lucara Diamond Corp, operators of Karowe Mine says it is moving closer to converting the mine into an underground operation.

The mining company, which is reputed for unearthing uniquely large diamonds, started the process of the conversion in 2018 when it embarked on a technical program to support a feasibility level study for a potential underground operation at its mine.

The feasibility study has now been completed and the results were announced in November last year.

The results reveal the potential to double the mine life from the original mine design of 2010 and add net cash flow of $1.22 billion and gross revenue of $5.25 billion.

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In addition, the study confirmed that the resource increase value with depth, the company said this week in its financial results for 2019.

The feasibility study results further indicate that on the basis that the underground operations start mid-2020, ore from underground mining will seamlessly integrate into current operations providing mill feed starting in 2023.

Since it started operations, Lucara has, through its Karowe Mine, produced some of the world’s largest rough diamonds, among them the historic Lesedi La Rona, a 1, 109 carat stone discovered in 2015.

Thereafter it continued discovering many other exceptional diamonds which went on to be sold at impressive prices.

In April 2019, Lucara unearthed yet another large diamond, a 1, 758 carat diamond which was later named Sewelo following a public naming competition in contest which attracted 22, 000 entries.

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Lucara aims to continue to unearth these kinds of diamonds for many years to come, and with the feasibility study having been completed in the last quarter of 2019, its focus has now shifted to project execution, including detailed engineering and design work.

It aims to continue all these works during the first half of 2020 as well as to continue with early procurement initiatives under a board-approved capital program of up to $53 million (approximately P530 million).

The company revealed it will also be reviewing its financing options, with a specific focus on the availability of debt finance to finance the capital costs of the underground development which exceed the company’s cash flow from operations.

Meanwhile, Lucara says 2019 was another strong year for the recovery of special stones, including 31 which were in excess of 100 carats, of which two were in excess of 300 carats, including the extraordinary Sewelo.

Overall, 24, 424 carats were recovered during the year with revenue reaching $192.5 million, an increase from $176.2 recorded in 2018.

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