Lucara Approves Karowe Underground Expansion Project

Lucara President and CEO, Eira Thomas
Lucara President and CEO, Eira Thomas

Lucara Diamond Company has approved the Karowe underground expansion project (UGP) following the Financial Close and satisfaction of all Conditions Precedent pursuant to the previously announced senior secured project financing debt package of $220 million (about P2.2bn) signed on July 12, 2021.

The facilities include two tranches, a project finance facility of $170 million to fund the development of the underground project. The other is a $50 million working capital facility to re-finance the company’s existing debt and to support ongoing operations.

Lucara president and CEO, Eira Thomas said an utilisation notice from the $170 million project loan facility has been accepted and the first funding for the Karowe underground expansion is expected to be received in mid-September.

Capital costs for the UGP totalling $534 million, will be met with funds from a combination of the facilities, the projected cash flows from the Karowe open-pit mine during the underground construction period, and the equity financings totalling $32.8 million closed July 15, resulting in the UGP being fully financed. CFO and corporate secretary, Zara Boldt said construction efforts have ramped up since the facilities documentation was executed in mid-July.

“We are delighted to have completed this significant milestone following the signing of loan documentation in mid-July,” she said.

“We would like to thank our lenders and advisors for their efforts towards achieving financial close of the facilities.”

Ventilation shaft pre-sinking has commenced with the completion of the first set of cover holes, and a total of four blasts occurring to date with continued drilling, mucking, and installation of ground support on a 24-hour basis.

The ventilation shaft depth below the shaft collar is currently at approximately 17 metres. Mobilisation to the site of the remaining pre-sinking equipment and contractors is underway.

Civil work on the remaining ventilation and production shaft infrastructure is progressing well, with mobilisation of temporary generators and civil works associated with the generator pad completed.

Editor's Comment
A Call For Government To Save Jobs

The minister further shared that from the 320 businesses that notified the Commissioner of Labour about their plans to retrench, 20 were acceded to, which resulted in 204 workers being retrenched during April 2020 and July 2021.The retrenchments were carried out while the SoE was in place, meaning the companies that succeeded must have had solid reasons, despite the strict SOE regulations imposed on businesses to not retrench. We are left with...

Have a Story? Send Us a tip
arrow up