Mountain Province up 16% on NWT diamond mine update
Mountain Province Diamonds Inc. [MPVD-TSX, OTCQX] shares rallied Thursday after the company released an updated mineral reserve and resource estimate as well as a life of mine plan for its Gahcho Kue diamond mine located in Canada’s Northwest Territories, 280 kilometres northeast of Yellowknife.
Mountain Province Diamonds is a 49% participant with De Beers Canada in the Gahcho Kue mine.
Mountain Province said the updated life of mine plan is the result of engineering work done to steepen the pit walls. Updated geotechnical pit slope recommendations since the 2022 Technical Report allowed the various pits to be redesigned with steeper walls, allowing additional kimberlite to be captured within the pits and an updated life of mine plan.
In the update, Mountain Province said its 49% share of operating cash flow from remaining open pit mining operations is estimated at $626 million. Ore processing is now expected to finish in early 2031, not 2030 as estimated in a 2022 Technical Report. Also, on a full-year basis from 2024 to 2031, the company said the total diamond recovery is estimated to be 36.3 million carats, up from 30.8 million carat in the 2022 report.
Mountain Province shares advanced on the news, rising 16% or $0.02 to 14.5 cents. The shares trade in a 52-week range of 46 cents and 10.5 cents.
“This is an important update to the production profile of the Gahcho Kue mine,’’ said Mountain Province President and CEO Mark Wall. “The diamond market is considerably softer than the period when the previous 2022 Technical Report was completed, which creates upside opportunity to the economics should prices improve.’’
Meanwhile, an updated mineral resource estimate pegs the total indicated resource at 24.7 million tonnes, containing 38.8 million carats at a grade of 1.57 carats per tonne. On top of that is an inferred resource of 13.3 million tonnes, containing 23.7 million carats or 1.79 carats per tonne.
The estimated mineral reserve now stands at an in-situ total of 20.3 million tonnes or 32.1 million carats at 1.59 carats per tonne in the probable category. On top of that is a probable stockpile of 3.3 million tonnes, containing 2.4 million carats at a grade of 0.73 carats per tonne.
That brings total probable reserves at the mine to 23.6 million tonnes, containing 34.6 million carats at a grade of 1.47 carats per tonne.
The Gahcho Kue joint venture property consists of several kimberlites that are actively being mined, developed and explored for future development. The company also controls over 113,000 hectares of mineral claims and leases surrounding the mine.
During the second quarter of 2024, 1.32 million carats were recovered, marking a 2.0% decline in comparison to the comparable quarter in 2023. The average Q2 grade of 1.37 carats per tonne, marked a 24% decline from the second quarter of 2023.