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Kimberley Diamonds to Recommission Lerala Mine
Jun 2, 2014 3:24 AM
By Deena Taylor
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RAPAPORT... Kimberley Diamonds Ltd. (KDL), the Australia-based mining company, said it will recommission its Lerala diamond mine in Botswana. The company plans to spend $10 million (AUD 14.7 million) to restart the operation with work expected to commence in the first half of 2015. The mine is expected to produce 400,000 carats per year when it reaches full capacity.
Lerala was placed on care and maintenance in July 2012 by its former owners, Mantle Diamonds. KDL bought Mantle Diamonds in fully stock-based purchase that closed earlier this year.
At the same time, the company decided to defer development of its Ellendale E4 mine and will place it on care and maintenance after it failed to secure a price increase from Laurelton, the polishing subsidiary ofjeweler Tiffany & Co. Approximately 75 percent of revenue generated from Kimberley’s Ellendale project is derived from an off-take agreement to supply Laurelton with high-quality fancy yellow diamonds. The company noted that it will withdraw the $9.7 million (AUD 14.3 million) funding commitment it made in February to develop the mine.
Meanwhile, mining at the Ellendale E9 mine will continue. The company is considering options to extend E9's life of mine by focusing on treating course tailings. Mining recommenced at E9 in April 2014 following the end of the rainy season. The company is currently processing high-grade ore from the pipe and expects to conclude mining E9 West and the far east pit in October 2014, while ore processing will continue until January 2015.
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Tags:
Deena Taylor, diamonds, E4, E9, Ellendale, Kimberley Diamonds, Lerala
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