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Lucara Diamond Corp has recovered a 1 080 ct Type IIa diamond at its Karowe mine, in Botswana – the fourth diamond weighing more than 1 000 ct to be recovered at the mine since 2015.

The other three 1 000-ct-plus diamonds recovered at Karowe include the 1 758 ct Sewelô, recovered in 2019; a 1 174 ct diamond recovered in 2021; and the 1 109 ct Lesedi La Rona, recovered in 2015.

“As we progress mining deeper in the openpit and transition to underground mining, exclusively in the South Lobe, the preponderance of large, high-value stones is increasing, consistent with the resource model and underpins the strong economic rationale for investing in the underground expansion that will extend the mine life out to at least 2040,” CEO Eira Thomas comments.

Lucara further reports that it is on track to meet its full-year production guidance, after having recovered 90 497 ct from the Karowe mine in the three months ended June 30.

This compares with the 86 317 ct recovered in the same quarter of last year.

The company has noted an increase in the proportion of special diamonds recovered – those larger than 10.8 ct – in the quarter under review to 162, including four diamonds greater than 200 ct in weight, and 13 diamonds greater than 100 ct in weight.

The special diamonds recovered in the quarter comprised 6.6% of the weight percentage of total recovered carats processed, compared with 6.1% for the prior comparable quarter.

Thomas says that although production was higher year-on-year, revenues generated were lower at $41.1-million, compared with $52.3-million in the prior corresponding quarter, owing to weaker diamond prices and a planned change in product mix as of this year.

The company generated $9.2-million of cash flow from operating activities in the period, while net income was $5-million, or $0.01 a share. This compares with net income of $12.5-million and earnings a share of $0.03 apiece in the quarter ended June 30, 2022, as a result of lower diamond prices.

Adjusted earnings before interest, taxes, depreciation and amortisation decreased to $15.7-million in the reporting quarter, compared with $24-million in the prior comparable quarter.

Full-year production guidance is set at between 395 000 ct and 425 000 ct.


The longer-term outlook for natural diamond prices remains positive, anchored on improving fundamentals around supply and demand – as many of the world’s largest mines reach their natural end of life over the next decade.

Following on the record high diamond prices achieved in early 2022, a softer diamond market emerged in the latter half of 2022 which has persisted into the second quarter of 2023, the result of global economic concerns combined with geopolitical uncertainty, including the ongoing conflict in Ukraine.

Prices continued to show signs of stabilisation, however, as China continues to open up post-Covid-19.

Sales of lab-grown diamonds increased during the period; however, intense competition, combined with improvements in technology, continue to drive prices of lab-grown diamonds down.

This further differentiates this market segment from the natural diamond market and highlights the unique nature and inherent rarity of natural diamonds.

The longer-term market fundamentals remain unchanged and positive, pointing to strong price growth over the next few years as demand is expected to outstrip future supply, which is now declining globally, Lucara notes.


The company continues to develop the Karowe underground project, having spent $22.5-million in the quarter under review to advance sink and grout programmes in the ventilation and production shafts.

Lucara released an updated schedule and budget for the project in the quarter, which extends the duration of the construction period.

The anticipated start of production from the underground expansion project has been moved from the second half of 2026 to the first half of 2028, with a revised forecast cost of completion of $683-million, compared with an initial estimate of $547-million.

Thomas explains that the rebased schedule and budget have increased costs by about 25%; however, sufficient surface stockpiles ensure that the mill will operate to capacity during this period, while the project remains economically robust.

The update to the schedule and budget was initiated in response to slower-than-planned ramp-up to expected sinking rates, as well as to account for anticipated future grouting programmes.

In turn, grouting programmes have taken longer than expected owing to a combination of high water volumes in the sandstone lithologies between 870 m and 752 m above sea level in depth – and 144 m to 262 m below the shaft collar.

There were also technical challenges associated with the transition to main sinking.

Lucara had cash and cash equivalents of $26.7-million as of June 30.

The company’s debt package consists of a $170-million project loan to fund the development of the underground expansion at the Karowe mine, as well as a $50-million working capital facility (WCF).

To this end, Lucara has near-term commitments, including the maturity of its WCF on September 1 and the requirements to fund a cost overrun facility.

Owing to these near-term commitments, there is concern about the company’s ability to meet its commitments and discharge its obligations in the normal course of business.

“While management believes the company will be able to resolve the noted items through its ongoing engagement with lenders, there can be no assurance that these efforts will be successful,” the company states.