BlueRock Diamonds PLC (LON:BRD) achieved record production numbers from its Kareevlei diamond mine in South Africa last quarter.
Despite issues with the crushing circuit, the miner reported production volume of 63,621 tonnes in the three months ended September 30, taking total production for the year up to 133,050 tonnes, compared to 103,506 this time last year.
READ: BlueRock narrows half-year losses
The average grade remained steady at 3.1 carats per hundred tonnes (cpht) (Q3 17: 3.1), while the value per carat averaged US$341 in the quarter (Q3 17: US$362).
However, BlueRock lowered its full-year guidance to 200,000 tonnes from 220,000, citing “continuing issues with the reliability of the plant”.
Due to all mining in the current quarter being mainly near-surface ore, BlueRock has reduced its grade guidance for the year to 3.0 cpht.
“Our increased production in the quarter and in 2018 is encouraging however we are not yet where we would like to be,” said chief executive Adam Waugh.
“Operations are moving into an exciting phase and the knowledge built up at Kareevlei will be important in making the correct decisions for the future.”
Alongside the production update, the AIM company unveiled plans to significantly increase production capacity at Kareevlei over the next year or so.
Subject to funding, bosses want to invest in the upscaling of the mining operation, plant and the necessary personnel at Kareevlei. A more detailed announcement will be made in due course, they said.
Capital reorganisation
Helping to develop these plans is mining veteran Michael Houston, a former executive at Anglo American PLC (LON:AAL) and the ex-CEO of Shanta Gold Limited (LON:SHG).
He is currently just advising, but BlueRock expects him to formally join the board in the near future.
Waugh added: “Mike Houston and his team who come with experience of mining operations on a much larger scale than Kareevlei have been able to bring in some fresh thinking and in their initial assessment, are encouraged by the potential of the business.”
At a general meeting later this month, BlueRock will ask investors to approve a capital reorganisation that would see the nominal value of its shares be reduced from 1p to 0.01p in order to help it raise money further down the line if necessary.
Shares fell 16.4% to 0.69p in late-morning trading.