- Karowe UGP anticipated to reach up to $100m by end of 2024
- Plan includes acquisition of underground mining equipment
- Lucara expects to mine between 3.6m and 4.6m tonnes of material in 2024
GAZETTE REPORTER
Lucara Diamond Corp has reported a $11.2 million (about P151.6 million) investment in the second quarter of 2024, directed towards the ongoing development of Karowe Mine Underground Project (UGP).
This is revealed in the Q2 2024 financial results of leading independent producer of large, exceptional-quality Type IIa diamonds from its 100 percent-owned Karowe Diamond Mine that were released this week.
The expenditure was primarily allocated to surface infrastructure and shaft sinking activities, underscoring Lucara’s commitment to enhancing its mining operations in Botswana.
Shaft sinking
In its report, Lucara reveals that capital costs for the Karowe UGP are anticipated to reach up to $100 million by the end of 2024.
The focus of these expenditures will be predominantly on shaft sinking activities and station development, which are key components of the mine’s transition from open-pit to underground operations.
Surface works – including completion of construction of the bulk air cooler and installation of the people and materials winder building – are also scheduled for completion within the year.
Additionally, Lucara’s 2024 project plan includes tendering contracts for underground lateral development and acquisition of underground mining equipment.
Progressing admirably
William Lamb, President and CEO of Lucara Diamond Corp, commented on the progress, stating: “Lucara’s performance this quarter reaffirms our position as a leader in the diamond industry.
“Our unwavering commitment to safety and operational excellence continues to drive our success, with both our open-pit operations and underground construction progressing admirably.
“The Underground Expansion Project, in particular, is advancing well, with shaft sinking progress surpassing our expectations.”
Between 2025 and 2027
The development of the UGP is a significant milestone for Lucara as it transitions to underground mining operations by 2027. The company expects to mine between 3.6 and 4.6 million tonnes of material in 2024, with ore tonnes representing approximately three-quarters of the total tonnes mined.
Lucara’s strategy includes stockpiling a portion of the tonnes mined before the open-pit mining ends in mid-2025. This stockpiled material will be processed between 2025 and 2027 before the mine fully transitions to underground operations.
During this transition, ore from the underground development is expected to supplement the lower-grade stockpile material, primarily sourced from the upper benches of the south lobe.
Recovery tailings
Lucara’s Q2 2024 report highlights a notable improvement in diamond recoveries and quality, following a period of lower-than-expected output in the fourth quarter of 2023 and the first quarter of 2024.
In the three-month period ending 30 June 2024, Lucara recovered a total of 92,419 carats at a recovered grade of 12.9 carats per hundred tonnes (cpht) of direct milled ore.
An additional 8,349 carats were recovered from the processing of historic recovery tailings.
Specials
The recovery of 206 Specials – defined as rough diamonds larger than 10.8 carats – was a significant achievement for the company. These Specials accounted for 6.9 percent by weight of the total recovered carats, aligning with the company’s expectations for the quarter.
A total of 76,387 carats of diamonds were sold in Q2 2024, generating $41.3 million in revenue.
Lamb has emphasised the strategic advantage of Karowe Mine’s production profile in the face of market challenges. “The Karowe Mine’s consistent delivery of large, high-quality diamonds provides a natural hedge against market volatility,” he notes in the results.
Adaptability
“These exceptional stones, coupled with our innovative sales strategies, allow us to navigate current market conditions effectively. Looking ahead, I’m confident that Lucara is well-positioned for sustainable growth.”
He further remarks on the company’s forward-looking strategy, highlighting its adaptability in an evolving diamond market.
“Our expansion strategy and focus on operational efficiency provide us with the flexibility to adapt to market dynamics while continuing to deliver value,” he says.
“As we move forward, Lucara remains committed to setting new industry standards and capitalising on the opportunities that lie ahead in the evolving diamond market.”