Lucapa Diamond Co has concluded a funding package of up to A$19 million to fund the acquisition and advancement of the high-value Mothae kimberlite diamond project in Lesotho. The funding package includes the underwriting of LOMOA options, a bridging loan and the issue of new options. When combined with the cash repatriated from the Lulo diamond mine in Angola, the funding package leaves Lucapa on track to commence commissioning Mothae in the first quarter of 2018 under a staged, low-risk development plan.
Mothae’s production will complement the high-value production from the Lulo alluvial diamond mine, which delivered the world’s highest average US$ per carat prices in 2016.
Like Lulo, Lucapa considers Mothae to be a premium-quality diamond asset. Mothae has recovered large and valuable diamonds from historical bulk sampling and is located in the heart of the highest-price cluster of kimberlite diamond mines in the world – within 5 km of Letseng (the highest $ per carat kimberlite mine in the world) and close to the Liqhobong and Kao mines.
Lucapa is able to commit to developing Mothae because the 8.8 ha kimberlite pipe has been well defined through drilling and trial mining. The trial mining produced more than 23,000 ct of diamonds, which included individual stones of up to 254 ct and Type IIa diamonds which achieved actual sale prices of up to $41,500/ct.
The high-value nature of the resource is also reflected in the independent JORC resource estimate for Mothae of more than 1 Mct of diamonds at a modelled average diamond value of $1,063 per carat – the second highest JORC average price per carat in the world.
While the JORC classified resource has been estimated to a depth of 300 m, independent (unclassified) modelling of the Mothae kimberlite pipe extends to 500 m.
Under the Phase 1 Mothae development plan, Lucapa plans to process ~2 Mt of mainly weathered, near-surface kimberlite material at 720,000 t/y over the first three years. This material is primarily free-dig, which means it will require limited drilling and blasting. Lucapa will scope the Phase 2 development plan for Mothae once Phase 1 is fully commissioned.
In developing Mothae, Lucapa will also leverage off the significant operating experience its Board and management team have in Lesotho, including at the neighbouring Letseng and Kao mines.