Historic Karowe Mine targets P2.4bn revenues

Bullish: Karowe Mine expects to dig up more carats nest year
Bullish: Karowe Mine expects to dig up more carats nest year

Confidence still high from the recent discovery of the largest diamond in over a century, Canadian miner, Lucara Diamond Corporation is targeting revenue up to $220 million.

The revenue will range from $200 million to $220 million (P2.4 billion) from its Karowe mine next year.

The operating guidance excluded revenue from the sale of exceptionally high-value stones such as the 1,111-carat gem it unearthed last month, the company said in a statement.

 The Botswana Stock Exchange (BSE) listed company expects to declare an annual dividend of $0.04 per share in 2016 to be paid in four equal payments at the end of each financial quarter.

 This was in line with a new dividend policy, which increased the number of payments per year from two to four.
Although Lucara has recovered exceptionally high-value stones from the Karowe mine and is focused on the high-value south lobe, the company says it cannot predict when such diamonds will be recovered and sold.

 “It therefore considers sales from such stones as additional revenue to its baseline forecast.

“This baseline revenue is supported by Karowe’s consistent recovery and yearly sales of its current diamond profile, including specials – 10.8 carats or larger – and its exceptional diamonds,” the statement read. Last month, Lucara also announced the discovery of two exceptional stones from Karowe, weighing 813 and 374 carats each.
The company has also allocated $7 million to advance bulk sampling and drilling at two licences at Karowe to recover exceptionally large gems.

Lucara has also announced plans to spend between $15 million and $18 million on an additional large diamond recovery process at its Karowe mine.

The current process circuit has been designed to recover diamonds of up to 1,000 carat, but based on the recent recoveries of very large diamonds, and the expected continuation of recoveries of exceptionally large diamonds in the south lobe, Lucara said it would integrate an additional large diamond recovery process.

Together with Gem Diamond’s Ghaghoo Mine, Karowe is the only operating diamond mine outside of the Debswana stable.

The other two non-Debswana mines, BK11 and Lerala are currently mothballed.

Formerly known as AK6, Lucara produces around 400,000 carats per annum and is forecast to have a 15-year lifespan up to 2027.

Karowe stones are sold on the open auction market under Gaborone’s fledgling diamond tender market.

Lucara bought 70 percent of the Karowe mine in 2009 from De Beers for $49 million. It obtained 100 percent ownership of the mine the following year, when it bought African Diamonds PLC for $70.3 million in stock.

Editor's Comment
What about employees in private sector?

How can this be achieved when there already is little care about the working conditions of those within the private sector employ?For a long time, private sector employees have been neglected by their employers, not because they cannot do better to care for them, but because they take advantage of government's laxity when it comes to protecting and advocating for public sector employees, giving the cue to employers within the private sector...

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