The re-opening of the Lerala Diamond Mine next year will see the mine make an annual revenue of US$40 million (about P350 million), Managing Director of Kimberly Diamonds Limited (KDL), Noel Halgreen announced at the Botswana Resource Sector Conference a fortnight ago.
Kimberly Diamonds last year acquired 100 per cent of the equity in Mantle Diamonds Limited, including Mantle’s wholly-owned Lerala Diamond Mine located just under 50 kilometres from Martins Drift border. The mine had closed due to the economic downturn and following its acquisition by KDL, it is now ready for re-commissioning.
This follows the execution of engineering improvements designed to further enhance recovery and reduce operating costs. The company also made upgrades such as the purchasing of a new diamond sorter to replace out-dated technology and improve recovery, purchase of an optical waste sorter to improve the throughput capacity of the plant and replacement of the diesel power generators with a link to the national power grid.
The improvements, along with required working capital to restart mining, were last year estimated to be US$10 million (about P90 million). KDL initially aimed to restart mining at Lerala this year but that was pushed to next year. Lerala has a mine life of seven years and the company is targeting a production rate of 400, 000 carats per year, with an employ of about 150 people.
The closure deprived Government of benefits such as the revenue from the proceeds of diamond sales and taxes on the profits. The re-opening means that Government will start receiving royalties calculated at 10 per cent of the gross market value of the sales.
Mantle Diamonds website indicates that the Lerala Diamond Mine, which was commissioned in 2008 following a positive feasibility study by the previous owners, DiamonEx Limited, has a 15-year fully-permitted mining licence covering an area of 21.86km2.
It further indicates that four of the Kimberlites are within two kilometers of each other, with the fifth located approximately 5km from the main group. “With probable reserves measuring 11 metric tonnes and with a grade of 28 carats per hundred tonnes, the Lerala Diamond Mine has over 3 million carats in situ,” the website says.