DiamondCorp (LON:DCP) announced that a revaluation of the initial bulk sample taken from its Lace mine in South Africa last year has increased the price significantly.
SA Diamond Exchange revalued the 2,168 carats recovered from the bulk sample and estimated a price of US$172 per carat in the current market. This represents a 7.5 per cent increase from the US$160 per carat valuation of the first 1,850 carats from the bulk test announced last October.
DiamondCorp said the increase in value is a reflection of slightly better overall diamond quality in the final 318 carats, as well as a moderate firming of prices for Lace diamonds since the market correction in September 2011.
In light of the prices for Lace diamonds, the company has taken up the retreatment of tailings again. It will run this on a single shift basis for approximately 2 months and will then decide whether it will retreat tailings in two daily shifts.
In the meantime, SRK Consulting is on track this month to complete the Independent Engineering Report on the 47 level block cave proposed for the Lace mine.
The report is required to progress negotiations with several potential project finance providers looking to finance the underground development which is designed to mine 1.2 million tonnes of kimberlite and produce up to 500,000 carats of diamonds per annum.
Construction of a new equipment maintenance workshop has been completed and major rebuilds of the Lace mine underground mining fleet have started in readiness for rapid re-commencement of underground development once project finance is secured.
The cash balance is approximately £2 million at present with no debt, allowing project financing negotiations to be undertaken in a considered manner, DiamondCorp said.
The group also announced that, following preliminary sample results from kimberlite J-01 at Jwaneng South in Botswana, it has decided not to explore the property further and hand all rights back to the tenement holder Geoperspectives (Pty) Ltd.
It only recovered low grades from J-01, and had previously announced low recoveries from the J-05 kimberlite.
DiamondCorp managing director Paul Loudon said: "Despite being located near to the richest diamond mine in the world and the encouraging mineral chemistry displayed by these kimberlites, mini bulk tests suggest they do not contain macrodiamond grades sufficient to support a large-scale commercial diamond mine.
“Management remain in active discussion with numerous parties regarding additional kimberlite projects in Botswana and other diamondiferous regions of southern Africa," he added.