Entrance to the new
underground Lace diamond
mine, where mining is
underway again
London, England — MININGREVIEW.COM — 07 June 2011 – Emerging diamond producer DiamondCorp says it expects the development of its Lace project in the Free State province of South Africa to cost up to R126 million.

The company has just completed a detailed review of full-scale mine development costs and estimated life of mine operating costs for the project, located near Kroonstad, where underground bulk sampling is underway. It says net capital cost estimates to reach full production range from R100- to R126 million, depending on revenue from diamond sales during development.

“The Lace mine has the potential to be a significant cash generator for DiamondCorp, with more than 25 years of mine life,” said CEO Paul Loudon.

“At current strong diamond prices, the initial minimum operating margin is expected to be a robust 46%, rising to very high levels if the diamond grade improves with depth, as forecast in the geological model,” Loudon added.

The 30,000t bulk sample underway at Lace will determine the initial mining grade and carat value at the top of the first mining block.

About 400,000t of kimberlite is scheduled to be mined from stoping development during the 17 months of mine development through to November 2012, when full-scale commercial production is expected to be reached.

Diamond sales revenue from this kimberlite will contribute between R90 million and R116 million towards mine development costs, depending on grade and carat value.