DiamondCorp (LON:DCP) said it remains on schedule to begin underground mining at its Lace operation in South Africa in the first half of next year despite ongoing industrial action by the Mineworkers and Construction Union (AMCU).
The strike, which is over the appointment of two further salaried shop stewards, will cause a one-week delay every fortnight it continues. DCP currently has five shop stewards.
Non-AMCU workers are carrying the development work into Upper K4 mining block and the company said productivity has improved 87% per person per shift since the walk-out began last week.
“The strike action has highlighted inefficiencies in work place practices which will be investigated and addressed when the striking workers return,” the company added.
Installation of the underground conveyor belt has been unaffected; however, mining of the tailings has been halted to allow the completion of an additional water storage dam.
DCP said Diamond sales for the nine months to September 30 totalled 16,505 carats at an average price of US$65 per carat.
Recovered in July was a 15.2 carat diamond that has been turned into two brilliant cut diamonds (5.33 carats and 2.07 carats) ready for sale.
Broker Sanlam repeated an unchanged 'buy' rating and target of 15p, noting that striking in South Africa does not only affect the mining industry, and pointed to the fact the Post Office has been striking for the last two months.
Panmure also repeats an unchanged 'buy' rating with a target of 19p, saying that while the current Lace strike could pose a risk to project timelines "if it continues for an extended period, it has not brought Lace to a halt".
DiamondCorp shares eased 1.79% to 6.875p.