Lucara Diamond Corporation is among the upswing diamond companies set up quite recently. The Company has a 60% share in the AK6 kimberlite project at the Karowe mine in Botswana. It also has a diamond project Mothae in Lesotho and a Kavango project in Namibia. Lucara Diamond Corporation plans to develop the mines in Zimbabwe and Cameroon. The main diamond production is carried out at the Karowe diamond deposit in Botswana by Boteti Mining Limited that is wholly-owned by the Company and is its major diamond mining operation.
In 2015, the Company completed the implementation of the Motae project in Lesotho where it did exploration at the kimberlite diamond field. As the license was over in December 2015, it was returned to the Lesotho government. Paragon Diamonds showed its interest in this kimberlite deposit and is seeking financing.
Moreover, under the concession arrangements the Company does the geological exploration with the ancillary mining of diamonds in Angola at the Lulo mine as well as the kimberlite bodies exploration in Botswana. In 2014, the Company was granted two prospecting licenses in Botswana and these licenses cover three diamond-bearing kimberlites - BK02, AK11 and AK12.
It supplies its diamonds to the global market via its sorting unit in Gaborone (Botswana) and is already among the world’s major diamond producers by value and a leading exploration company. Lucara is a member of the Lundin Group with its shares quoted as «LUC» at the Nasdaq Stockholm Stock Exchange and the Botswana Stock Exchange.
Due to the changing projects that are under implementation, the production structure of Lucara Diamond Corporation is continually evolving. The changes in the structure in 2012-2016 are given below in Figures 1 and 2.
Fig. 1. Production structure of Lucara Diamond Corporation in 2012.
Fig. 2. Production structure of the Lucara Diamond Corporation in 2016.
The Karowe deposit is located in Central Botswana in the northern part of the Kalahari Desert approximately 20 kilometers away from Letlhakane. Diamond mining at the deposit was launched in late 2011. The Karowe mine was put in full production in Q2 2012.
At present, the Karowe mine is the largest diamond mining operation of Lucara Diamond Corporation by production, and the significant growth of the main product sales value is due to the sales of high-quality big-size Type IIa diamonds, larger than 10.8 cts, as well as very rare Type II blue diamonds.
To recover large rough diamonds at the Karowe mine, the beneficiation technology is used that enables undamaging the stones and their staged crushing and separation using the X-ray equipment, XRT, starting from sizes of 60 mm down to 8 mm. Diamond-bearing product (8 mm - 1.25 mm in size) undergoes heavy medium separation followed by diamond content upgrading in the X-ray separators. In addition to that, the Company used its expertise in detecting possible big-size diamond occurrence to change the technology and reached the upper limit size up to 100 mm, and fitted the beneficiation plant with the additional equipment.
At the end of the last year, three big-size diamonds were recovered at the Karowe mine: «Constellation», 813 carats, sold for $63 mln in May 2016; «Lesedi La Rona», 1 109 carats, put on auction in June 29, 2016 but found no its buyer yet; and a 374-ct diamond yet to be sold.
Table 1 shows the technical and economic performance indicators of Lucara Diamond Corporation in diamond mining from the moment it reached the project capacity in 2013-2015 and estimated figures for 2016.
Table 1
Diamond production and sales reported by Lucara Diamond Corporation in 2013-2015
Based on the data of the annual reports of Lucara Diamond Corporation, 2013-2015
Lucara Diamond Corporation is a unique company among the diamond producers that - with relatively low diamond output (350 000 – 450 000 cts) - has its revenue at the level of the second-tier companies thanks to the recovery of large diamonds. Moreover, the big-size diamond production was made continuous thanks to the use of the diamond-saving technology. By now, more than 100 diamonds weighing over 100 carats have been recovered. It is also worth mentioning the high value of the Karowe diamonds that are rare Type IIa ones, as well as high value of very rare blue Type II diamonds, which adds high value to the diamonds on sale.
Taking into account the existing diamond reserves at the Karowe mine and other deposits where Lucara Diamond Corporation is carrying out the exploration, the prospects for its development look bright.
Yuri Danilov, Director of “Expert” Information and Analysis Center at Ammosov North-Eastern Federal University
