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RAPAPORT... Dominion Diamond Corporation reported that Diavik diamond mine production fell 13.5 percent year on year to 1.7 million carats for the third quarter that ended on September 30. Dominion Diamond owns a 40 percent stake in the mine, while Rio Tinto owns a 60 percent share. Despite the reduction, Dominion confirmed that Diavik's production goal of 7.3 million carats for this year remains on target.
Diavik's mining activity is now exclusively underground with approximately 700,000 tonnes of ore expected to be sourced from A-154 North, 500,000 tonnes of ore from A-154 South and 700,000 tonnes of ore from A-418 kimberlite pipes. Included in the estimated production for calendar 2013 is approximately 400,000 carats from reprocessed plant rejects (RPR) and 100,000 carats from the improved recovery process for small diamonds. RPR and small diamond recoveries were not included in the company's reserves and resource statement.
Dominion Diamonds' production at the Ekati diamond mine included 400,000 carats from reserves and 300,000 carats from coarse ore rejects and diamond-bearing kimberlite excavate from a satellite body in the Misery open pit. Dominion Diamonds acquired Ekati on April 10. One year ago, BHP Billiton reported producing 313,000 carats during the same period. Since the acquisition, Dominion Diamond recorded Ekati's production at more than 1 million carats. Dominion filed its land use and water permits for the Lynx kimberlite pipe, about 3 kilometers southwest of the Misery pit, which has an indicated resource of 0.8 carats per tonne, with a modeled rough diamond price of $257 per carat.
The current life of mine plan for Ekati ends in late 2019, but Dominion Diamond believes it can extend production by developing the Jay and Cardinal kimberlite pipes, which it recognizes as the largest diamondiferous resource in North America.
Based upon Dominion Diamond's sales during the third quarter, and the current diamond recovery profile at the Diavik and Ekati processing plants, the miner modeled approximate rough diamond prices per carat for each ore body types. At Diavik, A-154 North was $180 per carat, A-154 South was $140 per carat, A-418 was $100 per carat and RPR was at $50. Ekati's model for Misery south and southwest ore was between $80 and $100 per carat, while coarse ore rejects were $65 to $120. Model carat prices for Ekati's Fox pipe was $300, Koala North at $410, Koala phase 6 at $395 and phase 5 at $345.
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