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Stornoway's Completion Rate at Rénard Reaches 17%

Mar 12, 2015 11:53 AM   By Ronen Shnidman
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RAPAPORT... Stornoway Diamond Corporation reported a profit of $7.7 million for the third quarter that ended on January 31.  Construction on its Renard diamond project in Quebec was 17.4 percent completed, which was better than the 15.6 percent completion rate the company predicted for this time period. As of January 31, the company's incurred costs and commitmentstotaled $225 million, or 27.7 percent of its fully funded capital budget for Renard.

Matt Manson, the CEO of Stornoway, said, "Stornoway's construction team continues to make excellent progress toward the completion of the Renard mine. The forecast cost to complete remains within our fully funded capital budget of $811 million and the project remains on schedule for first ore in the plant in the second half of calendar 2016 and for commercial production in the second quarter of calendar 2017.

"Prioritization has been given to critical path construction items such as the accommodation complex, mine office and civil works, over non-critical path engineering and procurement activities under the EPCM mandate. This has resulted in our overall construction advancing modestly ahead of the planned schedule. The current financials again reflect the impact of the recent devaluation of the Canadian dollar. While this can be expected to create volatility in our earnings statements going forward (due to a fair-value calculation on a portion of our carried debt), a lower Canadian dollar serves to create a significant foreign-exchange gain on our funded and committed cash balance (both actual and unrealized) and increases the future potential operating margins of the project. These are both highly positive factors in the outlook for the corporation," Manson said.

Tags: Canadian diamonds, construction, quebec, renard, Ronen Shnidman, stornoway
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