Cape Town, South Africa — MININGREVIEW.COM — 01 February 2010 – Suspended diamond mining company Kimberley Consolidated Mining (KCM) has resumed mining at its Bo-Karoo mine at Christiana, in the North West province.
This has been revealed in a letter sent to shareholders last week. The letter “’ written by acting CEO Phemelo Sehunelo “’ said mining operations had resumed in November last year. It added, however, that a full report on the resumed mining activity would only be available at the next shareholders’ meeting.
Outgoing KCM financial director Koos Pieterse told Fin24.com that a sub-contractor was conducting mining operations. He said the sub-contractor, a shareholder in KCM, had bought the claims of the company’s creditors.
Pieterse went on to say that with the settlement of the company’s creditors the threat of liquidation against KCM had been removed. He added that resumed mining activity at Bo-Karoo had already yielded some positive hauls.
Pieterse stressed that the monthly costs were for the sub-contractor’s account. That meant KCM was currently protected against the risk of high operational costs should production not be good.
“KCM currently earns a straight royalty on the turnover of diamond sales on the tenders. And the last diamond tender sale realised some encouraging prices.” He said.
Pieterse conceded that KCM’s revival depended on the company being able to draw new mining assets into the mix. But before that can happen KCM needs to sort out its suspension on the JSE, he added.
Sehunelo explained that the company’s financial statements had been delayed by a request from the company’s audit committee to the external auditors to investigate unspecified allegations.
By now KCM’s half-year results to end-August 2009 are also overdue.
Sehunelo said that while the investigation was nearing its final phases, it was not possible to say exactly when the results would be published. “These results will be published in the quickest possible time,” he said.