ASX-listed Lucapa Diamond Company has agreed to funding and refinancing arrangements that will improve its financial position and reduce its financing costs.

The company has been investigating opportunities to replace or reduce the higher-cost debt used to fund the development of the new high-value Mothae diamond mine in Lesotho.

In line with that objective, Lucapa has agreed funding and refinancing arrangements with New Azilian and Equigold.

Lucapa MD, Stephen Wetherall, says he is delighted that the successful commissioning of the new Mothae diamond mine has drawn the strong support of New Azilian and Equigold.

“The successful delivery and de-risking of Mothae has added a second high-value asset to Lucapa’s growing diamond production base.

“These new refinancing arrangements will provide Lucapa with added financial strength to continue to build our strategic position in this niche high-value diamond sector.”

“The support from New Azilian and Equigold is also a strong endorsement of Lucapa’s growth strategy and our focus on maximising diamond production and cash generation from our Lulo and Mothae mines, while continuing our search for the hard-rock source at Lulo.”

These agreements reflect the successful delivery and de-risking of Mothae, which commenced commercial production in January 2019 following a successful commissioning and ramp-up phase and has already produced five +50 carat diamonds.

The agreements will enable Lucapa to reduce the Mothae development debt facility with Equigold well ahead of schedule, along with other obligations, while also supplementing working capital.