Thursday, July 18, 2024

Another gem from Botswana but for Lucara

The prolific South Lobe of Karowe mine is once again making major headlines following the discovery of a massive diamond. The 472-carat light brown stone becomes the third largest found by Canada based Lucara at its mine in Botswana.

“In 2018, mining at Karowe is focused in the high value south lobe, which consistently delivers large, high quality diamonds in excess of 10.8 carats in size,” said the recently appointed chief executive officer Eira Thomas in a press release.

“The 472 carat is the third largest diamond ever recovered from the mine and will be sold alongside other exceptional stones recovered since the beginning of the year as part of the first exceptional stone tender (EST) later in 2018.”

In a separate interview with Bloomberg to discuss Lucara’s latest find, Thomas said the early sampling work that was done on Karowe was done with equipment that really was not optimal and they ended up breaking a lot of diamonds.

“When we went into commercial production we expected to do better but we had no idea that the diamonds that were being broken were so much larger.”

The company has been investing millions to install new technology in the mine to help prevent breakage during the recovery process. Most recently, Lucara spent $30 million to expand its X-ray transmission technology which can detect gems earlier in the recovery process, allowing larger stones to be produced.

Lucara surprised the world in November 2016 when it laid claim to the world second largest diamond to be ever mined, unearthing a 1,111carat gem quality, Type IIa diamond. The white Type IIa diamond -later named Lesedi La Rona -which originated from the south lobe of Lucara’s Karowe Mine, is the largest ever to be recovered in modern day.

The unearthing of this exceptional gem diamond came more than a century later since the discovery of the world largest diamond; the 3,106-carat Cullinan, found near Pretoria in South Africa in 1905. It was cut to form the Great Star of Africa and the Lesser Star of Africa, which are set in the Crown Jewels of Britain.

The discovery of the rare find quickly catapulted the little unknown Lucara as the top producer of quality gems. Karowe mine has been a rare source of exceptional diamonds with its consistent recovery of large high value diamonds. Although it produces less than 1 percent of world’s diamonds, the mine is recovering more than 50 percent of the world’s diamonds larger than 100 carats.

In January 2013, it sold a 9.46 carat blue diamond recovered from Karowe mine for $4.5 million. This was later followed by the mining of a 239 carat diamond, which at the time was the largest diamond ever to have been recovered from the highly prolific Orapa kimberlite in over 40 years of production. This set in motion more discoveries of valuable diamonds, a 257 carat gem stone was unearthed in September 2013 and in May 2014, Lucara had mined 13 diamonds greater than 100 carats, two of which were greater than 200 carats.  In April 2016, Lucara’s prized jewel was the 342 gem quality diamond mined from the central and south lobe of Karowe. The diamond was auctioned for $20.55 million.

Lesedi La Rona sold for $53 million last year after it failed to find a buyer at the Sotheby’s auction in 2016. Lesedi La rona was expected to set yet another record as the most expensive rough diamond ever sold following Lucara’s sale of an 813-carat rough diamond (named the Constellation), the world’s sixth largest, for $63 million in 2016. The Constellation was extracted alongside another 374 carat gem, a chunk that broke off the Lesedi sold for $17.5 million.

Lucara is a diamond producer and explorer focused on diamond properties in Africa. The business of Lucara consists of the acquisition, exploration and development of diamond properties. The principal asset and current focus of Lucara is its Karowe mine in Botswana. Lucara holds a 100 percent interest in the Karowe mine, after it purchased 70 percent of the mine in 2009 from DeBeers for just $49 million. It later acquired 100 percent ownership of the mine when it bought African Diamonds for $70.3 million in stock.

In February 2018, Lucara also announced the acquisition of Clara, a secure, digital, rough diamond sales platform that combines proprietary analytics with existing cloud and blockchain technologies to modernize the current diamond supply chain. 

“Commercialization work has since commenced, under a budget of approximately US$2 million, and is tracking on schedule for implementation using diamonds from Karowe, beginning in August 2018,” said Thomas.

The CEO further said Lucara continues to focus on maximizing value at Karowe, where a pre-feasibility study assessing the potential for going underground and extending mine-life from 2026 to 2036 is well underway and progressing on schedule for completion towards year-end.


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