Lucara Diamond Corp, the Toronto/ BSE listed mining company, on Friday defied problems besieging junior miners as it officially opened its Karowe Diamond mine at a function near Orapa/Letlhakane mines.
The mine, which cost the developers P1.2 billion to bring to production, was delivered on time and on budget, according to the company CEO, William Lamb.
“The development of the Karowe mine is complete and has come in at budget,” Lamb said.
“The mine site has fully transitioned to operations personnel and the excellent safety standards developed during construction have been maintained,” he added.
Karowe, meaning ‘precious stone’, will process 2.5 million tones of ore annually in return recovering 400, 000 carats of diamonds over its 15 year mine life.
The mine is 100 percent owned by the Botswana registered company, Boteti Mining (Pty) Ltd, of which the Vancouver based Lucara Diamond Corporation has a 100 percent indirect interest.
The mine, formally AK6, was originally discovered by De Beers in 1969, but sold to Lucara, which is part of the Lundin Group of Companies.
The AK6 kimberlite was initially considered to be small and low grade based on early work. Reassessment work that began in 2003 revealed that the Kimberlite was larger and had a higher grade than previously estimated.
Boteti did advanced exploration work on the AK6 Kimberlite from December 2003, with completion of the final geological report in May 2007. In 2010, Lucara Diamond Corp. completed the acquisition of a 100 percent interest in Boteti Mining.
In July 2010 the decision was made to proceed with the construction of the diamond mine, including the process plant and all mine site and off-site infrastructure.
The mine is the fifth mine producing diamonds within a 30 km radius joining Debswana owned operations in Orapa, Letlhakane, Damtshaa and another one at Monak Ventures mine.
Lucara produces and sells diamonds independently from Diamond Trading Company (DTC) through an auction system.
The next sale of Karowe diamonds will take place during the first half of September with viewing of the diamonds being conducted in both Gaborone and Antwerp.
The Karowe Mine started production in 2012 and has immediately become a key diamond asset anticipated to produce over 400,000 carats per year on an annualized basis.
According to Lucara, as of July this year, more than 310,000 tonnes have been processed yielding in excess of 87,000 carats. In less than four months since the first ore run, the Karowe diamonds have brought in revenues of over $12 million to the company.
Karowe is expected to pay around P140 million in royalties and taxes to government annually if the current price levels are maintained.
At least 6.9 million tones of material is expected to be mined by December and about 270, 000 carats of diamonds to be recovered although by December although the number could be 300, 000.
The Karowe current pit depth is 48 metres and by the time it reaches its mine life span in 15 years, it will be 324 metres deep.
The mine’s Mining Manager, Johane Mchive told Sunday Standard it was early days to talk about prolonging the mine life, but admitted they will need to conduct economic studies.
“There is an opportunity for underground mining,” Mchive said. The mine was praised by President Ian Khama as the ‘first to deploy autogenous milling technology in Southern Africa’.
Lucara’s other asset is the Mothae mine in Lesotho, which is in the trial mining stage.
During the construction of the Karowe mine, the labour force peaked at 870 and 350 during the production operations stage.