business

Nov. 2, 2021

NEO SENOKO

3 min read

Mothae Mine reduces its debt

Mothae Mine reduces its debt

Lucapa Managing Director, Stephen Wetherall

Story highlights

  • Average prices achieved for the mine favourably impacted by recovering diamond market
  • Mothae recovered 9 567 carats and delivered a monthly record in August with 3 776 carats recovered

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MOTHAE Diamond Mine, a high value kimberlite diamond mine located in the highlands of Lesotho has reduced its debt to the Industrial Development Corporation of South Africa by $ 1.1 million (M16, 951, 198) in the third quarter.

The average prices achieved for Mothae have been favourably impacted by the recovering diamond market, with year to date prices of U$ 765/carat being 88 percent ahead of those achieved in the prior year comparative period.

The cutting and polishing partnership continues to deliver additional margins to the mine with many stones awaiting sale or still in the manufacturing stage.

“Lucapa continued to deliver against our strategic priorities, and we are satisfied with the results and production records, particularly as we faced some operational headwinds. The market for diamonds continued to be buoyant in a constrained rough supply environment with prices at levels not seen since 2012. As a result, we have upgraded our full year guidance,” Lucapa Managing Director, Stephen Wetherall said.  

Mothae is owned by its operator, Lucapa Diamond Company at 70 percent while the Government of Lesotho holds 30 percent shares.

Lucapa revealed that the Mothae mini and processing operations improved during the quarter, with the plant achieving record throughout for a quarter of 344, 978 tonnes and its highest average feed rate post the plant upgrade.  

This was achieved despite ramp up, inclement weather, challenges relating to electricity supply and unscheduled plant downtime. With many of the concerns addressed and warmer weather approaching, it is expected the plant ramp up in the fourth quarter will deliver against plan.

During the quarter, Mothae recovered 9 567 carats and delivered a monthly record in August with 3 776 carats recovered. The largest diamond recovered during the quarter was 51 carats, with fancy light pink and yellow also recovered.  There were 208 diamonds greater than 4.8 carats and 60 special stones recovered during the quarter.

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In the fourth quarter, the mine will be carrying out trials to determine if continuous miner technology can mine and deliver a fine feed envelope of ROM ore to the plant which Lucapa believes will result in meaningful increased efficiencies and cost reductions.

The expansion project at Mothae was completed in March this year and the mine began to operate at new expanded capacity from the beginning of the second quarter of 2021.

The expansion project was focused on increasing nameplate capacity by 45 percent from 1.1 million tonnes per annum to 1.6 Mtpa.

In December 2020, Lucapa sold six percent of its company stock to Graff subsidiary Safdico, to secure the funds for the expansion. The mine has an off-take agreement with Safdico under which the manufacturer purchases 100 percent of the rough from Mothae for a period of two and half years.

The increase meant Mothae would upsurge output by 45 percent while also raising its ore-processing capacity to 1.6 million tonnes per year from 1.1 million tonnes.

 

 

 

 

 

 

 

 

 

 

 

 

 

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