Gem Diamonds (LON:GEMD) reported a record full-year production at its flagship Letseng mine in Lesotho, southern Africa, with continued recovery of high value, exceptionally large diamonds.
In a trading update for the fourth quarter to end-December 2011, the group said Letseng recovered 46 rough diamonds, which achieved values greater than US$20 000 per carat, in the period, totaling 184 such diamonds for the full year, which have contributed circa 70 per cent of Letseng's revenue for the full year.
During the period 10 rough diamonds from Letseng achieved a value in excess of US$1 million each.
Letseng exported a total of 32,353 carats for sale during the fourth quarter, up 32 percent from the same period a year earlier.
Gem Diamonds approved Project Kholo in November last year, which will increase Letseng’s production through the construction of a third processing plant and other operational improvements. Production is planned to be ramped up to an annual 10 tonnes by July 2014.
Production from the Ellendale mine in Western Australia’s Kimberley region improved significantly during the fourth quarter, and Phase 1 development of the Ghaghoo diamond mine in Botswana is progressing well and on budget. Gaghoo is on schedule to deliver first production in mid-2013.
Gem Diamonds has a strong cash position of approximately US$158 million cash as at December 31 2011, of which approximately US$141 million is attributable to Gem Diamonds.