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Lucapa Raises Targets for Lesotho Mine

Oct 25, 2017 5:34 AM   By Rapaport News
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Lucapa Diamond Company has raised its output, cash-flow and mine-lifespan forecasts for the high-value Mothae kimberlite diamond project in Lesotho, where operations are due to start next year.

The Lesotho government has also agreed to defer an outstanding $4.5 million payment owed by Lucapa until mid-2018, the miner said this week.

Lucapa signed an agreement in January to acquire a 70% stake in the mine project for $9 million. The government of Lesotho holds the remaining 30%. Lucara Diamond Corp. originally owned the mine, but sold it in 2015.

A projected increase in the phase 1 diamond plant size from 100 tonnes per hour (tph) to 150 tph led Lucapa to revise its forecast for Mothae. The new mine development plan sees a 22% increase in diamond output to 498,000 carats, a 26% rise in net operating cash flows to $312 million and a 12% increase in mine life to 13.5 years.

“Mothae was already a compelling project and the optimized mine plan is set to enhance both the economics and production profile, targeting improved returns for all direct and indirect stakeholders in the project,” said Lucapa managing director Stephen Wetherall.

“We now look forward to bringing Mothae into production early in the second half of 2018 to add a high-value kimberlite production source to our exceptional Lulo alluvial production,” he added, referring to the company’s Lulo mine in Angola.

Lucapa will defer payment of the remaining $4.5 million it owes for the acquisition of its stake to June 2018, due to the planned increase in direct foreign investment into the mine under the new development plan, the company said. Lucapa has already paid the Lesotho government half of the $9 million price for its stake. Under the previous terms of the deal, Lucapa had been due to pay the $4.5 million balance in eight monthly instalments starting in October 2017.
Tags: Angola, Lesotho, lucapa, Lucapa Diamond Company, lucara, Lucara Diamond Corp., Lulo, mine development, mining, Mothae, Rapaport News, Stephen Wetherall
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