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Lace Diamond Mine Halted Due to Flooding

Nov 14, 2016 3:31 AM   By Rapaport News
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RAPAPORT... DiamondCorp said production at its Lace mine in South Africa will remain halted for more than 12 weeks after torrential rain flooded the site, resulting in a suspension of the company's shares in London and Johannesburg.

Two extreme thunderstorms on November 11 resulted in almost 90 millimeters of rain in just over an hour, equivalent to almost a third of annual rainfall at the mine in Free State Province, DiamondCorp said. Rebuilding work to the damaged systems could take up to 12 weeks – this is on top of more than seven days needed to pump the production level dry.

DiamondCorp said it is consulting a business-rescue practitioner for its subsidiary, Lace Diamond Mines.

Management is investigating "all options" as a consequence of the flooding and its impact on the miner's financial position, DiamondCorp said.

The announcement comes after DiamondCorp investigated pursuing a takeover or merger opportunity to deal with an urgent funding need. Subsequently, the miner decided against the move because offers on the table undervalued the business.

Flash floods hit South Africa last week, with fatalities reported in Johannesburg by the local media. All members of the Lace mine staff were evacuated without injury, DiamondCorp said.

Photograph courtesy of DiamondCorp plc
Tags: DiamondCorp, Lace, Lace Diamond Mine, Rapaport News, South Africa
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