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Lucara Anticipates Karowe to Generate $160M in 2014

Jan 13, 2014 5:37 AM   By Deena Taylor
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RAPAPORT... Lucara Diamond Corporation expects to generate between $150 million and $160 million in revenue this year from the sale of 400,000 carats to 420,000 carats recovered at its Karowe mine in Botswana.

In 2013, Lucara sold more than 438,000 carats of diamonds for proceeds in excess of $180 million. The company's diamond inventory stood at 67,000 carats on December 31 and it recently updated its Karowe resource estimate, resulting in a greater than $1 billion increase in the estimated in-situ value of the indicated mineral resource.

"Lucara had a strong year in 2013, achieving its production and operating cost targets and exceeding forecast revenue following the recovery of a high proportion of large exceptional quality diamonds during the year," said William Lamb, Lucara's president.

The company aims to improve its rate of large diamond recoveries during the year and it will build and commission a plant upgrade at Karowe to enhance large-stone production from the mine's harder ore in the south lobe. The company will use cash from its year-end balance together with 2014 cash flow to fund the upgrade, which is anticipated to cost between $45 million and $50 million. Construction is set to begin in the first quarter and expected to be completed by the fourth quarter. Once operational, the plant will process 2.5 million tonnes of grade per year for the remainder of the mine's life. Lucara will also use more than 10 million tonnes of waste to expand tailings at Karowe during 2014, in line with the mine's original feasibility plan.

At the end of 2013, Lucara's net cash position was $40 million and it had not drawn down funds from its $25 million credit facility with Scotiabank.
Tags: Botswana, Deena Taylor, diamonds, Karowe, Lucara Diamond Corporation
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