Lucara releases Q3 results, diamond mine shaft-sinking progress
Lucara Diamond Corp. [LUC-TSX, LUCRF-OTC] said the long-term natural diamond price outlook remains resilient due to favourable supply and demand dynamics as a result of decreasing production volumes from major operating mines.
“However, the smaller size stones market remains soft as demand is impacted by a weak Asian market and the increasing uptake of laboratory grown diamonds,’’ Lucara said in a press release containing its results for the third quarter of 2024.
“Demand for stones larger than 10.8 carats remains robust, as reflected in the company’s sales in the plus 10.8 category,’’ the company said. It said the G7 sanctions on Russian diamonds over one carat, effective March, 2024, caused some trade delays with import times returning to normal during the quarter.
Lucara shares eased 8.7% or $0.04 to 42 cents. The shares trade in a 52-week range of 63 cents and 25 cents.
Lucara is a member of the Lundin Group of companies. Its currently operating open pit mine at Karowe in Botswana is a conventional load and haul operation. The mine is a producer of large, high-value type 2a diamonds. It is the only mine to have produced four diamonds in excess of 1,000 carats in size.
The open pit mine operations are expected to terminate mid-2025. However, the mine currently has over three years of surface stockpiled reserves, which will be consumed as required while the underground mine operations ramp up to commercial production.
During the third quarter, Lucara said significant progress was made in shaft sinking and lateral development connecting the production and ventilation shafts, with the critical path ventilation shaft being ahead of the July 2023 rebase schedule. At the end of the third quarter, the production shaft had reached a depth of 686 metres and the ventilation shaft a depth of 582 metres below surface. During Q3, the company invested $24.1 million into the Karowe Underground Project (UGP). The UGP is designed to access the highest value portion of the Karowe orebody and is expected to extend the life of the mine beyond 2040.
Highlights from the third quarter included the recovery of two exceptional diamonds larger than 1,000 carats, including the epic 2,488-carat diamond and the 1,094-carat diamond. The company said a total of 116,221 carats of diamonds were sold, generating revenue of $44.3 million in the third quarter.
A total of 104,390 carats were recovered in Q3, 2024, including 96,597 carats from direct ore feed from the pit and stockpiles, at a recovered grade of 13.4 carats per hundred tonnes and an additional 7,793 carats recovered from processing of historic recovery tailings.
On October 4, 2024, the company sold its interest in Clara Diamond Solutions Ltd. Partnership, Clara Diamond Solutions B.V., and Clara Diamond Solutions GP. Clara is a secure web-based digital marketplace designed to transact single diamonds between 1.0 and 10 carats, in higher colours and quality.