Lucara Diamond sold 76,387 carats of diamonds from its wholly-owned Karowe Mine in Botswana, generating revenue of $41.3 million during the second quarter of 2024 compared to $38.6 million a year earlier.
Of the total revenue, $29.5 million came from the HB arrangements, compared to revenue of $25.8 million on the period ending June 30, 2023.
Revenue generated from HB was 71% of the total revenue recognised in the second quarter of 2024.
Under the sales arrangements with HB, +10.8 carat gem and near gem diamonds from the Karowe Mine of qualities that could directly enter the manufacturing stream are sold to HB at prices based on the estimated polished outcome of each diamond.
The sales volume transacted by tender was $9.2 million compared to $9.8 million in the second quarter of 2023 while that of Clara was $2.6 million from $3 million a year earlier.
Both sales channels experienced lower prices compared to the second quarter of 2023, reflecting the weakening of prices in the smaller-sized diamond market.
A total of 92,419 carats were unearthed during the quarter at a recovered grade of 12.9 carats per hundred tonnes of direct milled ore.
A further 8,349 carats were recovered from processing of historic recovery tailings.
It said the recovery of 206 rough diamonds larger than 10.8 carats equated to 6.9% by weight of the total recovered carats from the second quarter's ore processed which is in line with the company's expectation.
“In the face of a challenging diamond market, Lucara's unique production profile sets us apart. Our Karowe mine's consistent delivery of large, high-quality diamonds provides a natural hedge against market volatility,” said Lucara chief executive William Lamb.
“These exceptional stones, coupled with our innovative sales strategies, allow us to navigate current market conditions effectively.”
Meanwhile, the company said capital costs for the Karowe underground project are expected to be up to $100 million in 2024 and will focus predominantly on shaft sinking activities and station development.
It said surface works will focus on completing the construction of the bulk air cooler and the installation of the people and materials for the winder building.
The commencement of production from the underground project is anticipated in the first half of 2028.
The revised forecasted costs at completion are $683.0 million, including.
Karowe has incurred capital expenditures of $336.3 million for the underground project as of June 30, 2024, and further capital commitments of $69.7 million were made.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
