Higher-Grade Ore Boosts Lucapa Production

RAPAPORT… Lucapa Diamond Company’s output rose in the third quarter,
as the miner fully transitioned to the higher-grade portions of it Mothae and
Lulo deposits.



The miner recovered 7,007 carats from its Mothae mine in
Lesotho during the three months ending September 30, exceeding its plan by 30%, it
said last week. Sales of 4,412 carats from the site, which began commercial
production in December, totaled $2.1 million, at an average price of $476 per
carat.


“The move to the southern pit met with early success, with
recoveries including an exceptional 64-carat D-color, type IIa gem —
which subsequently became the first commercially produced diamond from Mothae
to achieve a sale price in excess of $1 million,” the company noted.


Output at the miner’s Lulo deposit increased 67% to 7,603
carats, as the recovered diamond grade jumped 88% over the same period last
year. Sales of rough from the Angolan mine rose 49% to $6.7 million, as the
company produced a larger number of higher-quality diamonds. The average price
jumped 28% to $1,143 per carat.


“The decline in global rough-diamond demand throughout 2019
brought about by factors including macroeconomic uncertainty, rising
inventories and liquidity in the midstream has impacted the revenues of all
diamond producers and industry sentiment,” explained Lucapa managing director
Stephen Wetherall. “However, in line with the more recent tender results
reported by other producers, we were encouraged to see a distinct uplift in
competitive bidding in our most recent Mothae tender, which was reflected in
the prices achieved.”


During the July-to-September period, the miner recovered 432
stones weighing more than 4.8 carats and 136 over 10.8 carats. At the end of
the period, Lucapa had 6,378 carats in its Mothae inventory and 4,903 carats at
Lulo.


In September, Lucapa sold its first rough stone — a
36-carat, D-color diamond — into a new cutting and polishing partnership, it
said. The company expects to sell the polished in the fourth quarter, generating extra profits.


Lucapa also owns the Brooking lamproite project in Australia and
the Orapa exploration site in Botswana, which it has put on hold to focus on Mothae
and Lulo.


Image: A selection of stones from Mothae offered at tender. (Lucapa Diamond Company)