Lucapa Unveils 35% Jump in Lulo Resources

RAPAPORT… Diamond resources at Lucapa Diamond Company’s Lulo deposit in Angola have surged 35%, the miner said Wednesday.

The resource level climbed to 135,900 carats as of December 31 from 100,700 carats a year earlier, the company noted, citing independent estimates from South Africa’s Z Star Mineral Resource Consultants.

The jump in mining potential reflects additional resources identified at the mine, as well as improved knowledge of existing areas where diamonds could be found. The improvement outweighed the depletion of about 23,600 carats last year and a reduction in grade to 6.86 carats per 100 cubic meters.

While resource estimates have been raised, the dollar value of diamonds yet to be excavated has slumped because of the impact of the coronavirus pandemic on prices. Production at the Lulo mine was valued at $1,440 per carat at the end last year versus $1,620 per carat a year earlier.

The increase in diamond resource potential is “a new record for carats in the Lulo diamond resource notwithstanding six years of mining depletion,” managing director Stephen Wetherall said.

Separately, Lucapa sold a 5,619-carat parcel of rough diamonds for $5.9 million, or $1,050 per carat, from its Mothae mine in Lesotho, it said Wednesday. The sale, the company’s second of the year from Mothae, included a 215-carat, D-color stone and a pink diamond weighing 11 carats.

The offering brings the company’s total revenue from its Mothae and Lulo mines for the year to date to $21 million from the sale of 15,607 carats.

“Since reopening following the six-month Covid-19 suspension, Mothae has shown its quality with regular recoveries of large and high-value diamonds leading to run-of-mine diamond prices above $1,000 per carat for the second sale running,” Wetherall noted. “This is [about] 75% above the average diamond price budgeted for Mothae in 2021.”

Image: The Lulo mine in Angola. (Lucapa Diamond Company)