Mothae Diamonds holds the mining lease and other assets related to the advanced Mothae kimberlite diamond project lease and other assets related to the advanced project in north-east Lesotho.
Lucapa Diamond highlighted in a statement that Mothae has existing infrastructure and a camp in place, including a diamond processing plant and boasts an indicated and inferred resource of 1 million carats. “All the infrastructure is in place to bring the mine into production within 12 months,” Lucapa Diamond said.
Lucapa Diamond MD Stephen Wetherall said he was delighted that Lucapa’s proposal to acquire and develop the highly sought-after Mothae kimberlite project had been selected as the successful bid by the government of Lesotho.
“This acquisition is in keeping with Lucapa’s stated strategy of continued growth as a diamond producer and explorer. Mothae complements the producing high-value Lulo diamond mine and our highly prospective exploration assets in the advanced Lulo kimberlite project and the earlier stage Brooking and Orapa Area F projects.
“There is only one thing better than owning one diamond mine that produces large high value diamonds – and that is owning two. Mothae is a fantastic diamond asset, located in a cluster of operating diamond mines in Lesotho and just 5km from Gem Diamonds’ Letšeng mine, which is the highest average $ per carat hard rock diamond mine in the world. Similar to Lulo in Angola, the Mothae kimberlite pipe hosts large premium-value and type IIa diamonds”.
Wetherall further stated that Lucapa’s widespread diamond mining experience and recent success in developing the Lulo mine in Angola – which delivered the highest price per carat run of mine diamond production in the world in 2016 – were key factors in Lucapa’s successful bid for Mothae.
“Mothae, acquired for a price we consider to be highly competitive, represents a compelling opportunity for Lucapa to grow its cash flows from a second diamond mining operation through a staged and low-risk development of a well-sampled kimberlite that has much upside potential.”
The company statement said the acquisition price of $9 million would be payable over 10 months. Lucapa will fund the acquisition from a combination of existing cash, anticipated distributions from Lulo operations, in-the-money option conversions, financing or equity.