VANCOUVER, British Columbia,
June 26, 2018 /PRNewswire/ -- Lucara
Diamond Corp. ("Lucara" or the "Company") (TSX: LUC) (BSE: LUC)
(Stockholm: LUC) is pleased to announce the results of the
Mineral Resource Update prepared in accordance with National
Instrument 43-101 ("NI43-101"). These new results will be used for
mine planning and to support the preparation of current
feasibility-level studies for the potential development of an
underground mine, after the completion of the current open pit
mine, at its Karowe Mine ("Karowe Mine") in Botswana.
Highlights and Updated Mineral Resource Statement
- The remaining Indicated Mineral Resource for Karowe's AK06
kimberlite includes 7.9 million carats hosted in 57.85 million
tonnes (in situ and stockpile) at an average grade of 13.7 carats
per hundred tonne (cpht) with an average modelled diamond value of
US$ 673 per carat
- Successful reclassification from Inferred to Indicated
Resources for the AK06 kimberlite between 600 and 400 metres above
sea level (masl). The new base of the Indicated Mineral Resource is
at 400 masl (600 metres below surface). In situ Indicated Mineral
Resources (as at end 2017) have increased by 44%
- A 54% increase in the remaining Indicated Mineral Resource for
the South Lobe of the AK06 kimberlite from 4.42 Mct to 6.78 Mct
achieved through the conversion of Inferred Mineral Resources to a
depth of 400 masl
- Modifications to the internal geological model for the South
Lobe of AK06 kimberlite result in the recognition of the EM/PK(S)
unit as the volumetrically dominant unit at depth within the South
Lobe. Historical recoveries from the EM/PK(S) have included several
large and high value diamonds such as the 1109 carat Lesedi La Rona
and the 813 carat Constellation
- 51% of the remaining South Lobe recoverable Indicated carats
and 35% of the tonnage is attributable to the EM/PK(S) unit, in
comparison with 12% carats and 8% tonnage from the previous
estimate.
- 75% of the South Lobe Indicated recoverable carats between 600
and 400 masl is attributable to EM/PK(S)
- EM/PK(S) controlled sample yielded a grade of 17cpht with 9.5
weight % specials (>10.8ct), 47 diamonds greater than
10.8ct including 1 >100 carats and 6 diamonds > 50 carats in
weight
- Mineral Resource estimates have been reported with an updated
recoverable grade model to reflect current process plant
efficiency
- Updated size distribution and value models which reflect
improvements to fine diamond recovery with commissioning of the
Phase 3 upgrades and overall diamond sales
Eira Thomas CEO, stated, "Going forward, the Karowe mine plan is
dominated by South Lobe ore, with the high grade, high value
EM/PK(S) unit becoming increasingly prevalent as we mine
deeper. We now understand that some of Karowe's large, high
value diamonds originated from the EM/PK(S) unit including the
historic 1109 carat Lesedi La Rona and the 813 carat Constellation
which sold for a record US$63
million. This resource update supports the continued
recovery of large high value diamonds from the South Lobe
throughout its remaining open pit mine life and the likelihood for
underground mining until at least 2036. Feasibility work
assessing the potential for underground mining, including
hydrogeological and geotechnical drilling together with several
mining trade off studies is ongoing."
The Karowe Mine has been in commercial production since
July 2012. The mine has produced and
sold over 2 million carats from 13.9 million tonnes of processed
kimberlite at an average sales price of $US
606/carat. Karowe is firmly established as one of the
world's foremost producer of large and high value diamonds.
The updated Mineral Resource Estimate was completed by Mineral
Services Canada Inc. The estimate is based on historical evaluation
data combined with new sampling results (microdiamond, bulk density
and petrography) from recent deep core drilling and from historical
drill cores. New delineation drill coverage and review of
historical drill cores supported an update of the internal
geological model. Production data (including a controlled
production run from the EM/PK(S) unit) and recent sales / valuation
results have been incorporated into the grade and value estimates,
which have been made based on an updated model of process plant
recovery efficiency. The updated Mineral Resource is reported based
on the Canadian Institute of Mining (CIM) Definition Standards for
Mineral Resources and Reserves as incorporated by National
Instrument 43-101 Standards of Disclosure for Mineral
Projects.
The updated Mineral Resource (Table 1a), valid at the cut-off
date of 26 December 2017, includes a
recoverable Indicated Mineral Resource at a 1.25 mm bottom cut off
size of 7.9 million carats hosted in 57.85 million tonnes at an
average grade of 13.7 cpht with an average modeled diamond value of
US$ 673 per carat. The new base of
the Indicated Mineral Resource is 400 masl (600 metres below
surface). The updated Mineral Resource also includes a recoverable
Inferred Mineral Resource of approximately 1.17 million carats
hosted in 5.84 million tonnes at an average grade of 20 cpht with
an average modeled diamond value of US$716 per carat between 400 masl to 256 masl
(base of current geological model). The updated recoverable
Indicated Mineral Resource for the South Lobe is presented in Table
1b, valid at a cut off date of
26 December 2017.
Table 1a: Statement of Remaining Mineral Resources in the
AK06 kimberlite
Classification
|
Resource
|
Volume
(Mm3)1
|
Density
(tpm3)2
|
Tonnes
(Mt)3
|
Carats
(Mct)4
|
Grade
(cpht)5
|
$/ct6
|
Indicated
|
North Lobe
|
0.62
|
2.48
|
1.54
|
0.20
|
13.0
|
222
|
Centre
Lobe
|
1.68
|
2.57
|
4.32
|
0.63
|
14.6
|
367
|
South Lobe
|
16.29
|
2.92
|
47.63
|
6.78
|
14.2
|
716
|
LOM SP
|
1.28
|
1.85
|
2.36
|
0.09
|
3.8
|
609
|
Working SP
|
1.05
|
1.91
|
2.01
|
0.20
|
9.7
|
661
|
Total
|
20.92
|
2.77
|
57.85
|
7.90
|
13.7
|
673
|
Inferred
|
South Lobe
|
1.93
|
3.02
|
5.84
|
1.17
|
20.0
|
716
|
The reported resources are those remaining (including stockpile
material) as of 26 December 2017.
Table 1b: Statement of
Remaining Indicated Mineral Resources in the South Lobe: AK06
kimberlite
Classification
|
Resource
|
Volume
(Mm3)1
|
Density
(tpm3)2
|
Tonnes
(Mt)3
|
Carats
(Mct)4
|
Grade
(cpht)5
|
$/ct6
|
|
Indicated above 600
masl
|
South
(other)
|
0.04
|
2.67
|
0.11
|
0.01
|
12.0
|
716
|
|
M/PK(S)
|
8.24
|
2.91
|
23.97
|
2.64
|
11.0
|
716
|
|
EM/PK(S)
|
2.56
|
2.76
|
7.06
|
1.31
|
18.6
|
716
|
|
Indicated 600 to 400
masl
|
M/PK(S)
|
2.23
|
3.05
|
6.80
|
0.70
|
10.3
|
716
|
|
EM/PK(S)
|
3.23
|
3.00
|
9.68
|
2.11
|
21.8
|
716
|
|
Indicated South
Lobe
|
South Lobe
Total
|
16.29
|
2.92
|
47.63
|
6.78
|
14.2
|
716
|
|
|
1. m3 = million cubic metres, 2.
tpm3 = tonnes per cubic metre, 3. Mt = million tonnes,
4. Mct = million carats, 5.cpht = recoverable (+1.25 mm) carats per
hundred tonne, 6. $/ct = recoverable (+1.25 mm) United States dollars per carat.
Tonnage, grade and value estimates are based on updated Mineral
Resource Estimate prepared by MSC under the supervision of Dr.
Tom Nowicki of Mineral Services
Canada Inc. a "Qualified Person" within the meaning of NI 43-101
and independent of Lucara. Mineral Resources that are not Mineral
Reserves do not have demonstrated economic viability. The AK06
mining licence (ML2008/6L) expires in May
2023. The mining licence will have to be renewed for the
underground development at AK06 to progress.
The Mineral Resource estimate for AK06 above 600 masl is
restated with minor modifications from the previous project
Technical Report (see Lucara Press Release of 15 December
2017). A high confidence geological model and comprehensive
bulk density dataset constrain estimates of volume and tonnage.
Grade estimates are based on a well-distributed Large Diameter
Drilling (LDD) sample dataset that supports the interpolation of
local grade estimates. Modifications to the previous estimate
include revisions to the geological model, more aggressive capping
of outlier LDD grade values used for interpolation and updated
diamond values for the South Lobe to reflect the current production
and sales dataset.
The Mineral Resource Estimate for AK06 below 600 masl has been
significantly revised from the previous estimate based on the
results of core drilling and microdiamond sampling work carried out
in 2017/18. Volume and tonnage estimates are similarly based on the
AK06 geological model and a spatially representative broad bulk
density sample coverage. Grade has been estimated using a
microdiamond-based approach that is based on a calibration of the
ratio of microdiamond stone frequency (stones per kilogram) to + 1
mm LDD macrodiamond grade, explained in more detail in the grade
section below.
The revised Indicated Mineral Resource will be used for mine
planning purposes and to support the current feasibility level
studies currently underway for the potential development of an
underground mine at Karowe following the release of a positive PEA
in Q4 2017 (see Lucara Press Releases of 15
December 2017, 2 November
2017).
Geological Model Update
The 2018 pipe shell model is defined by a total of 154 pierce
points in 71 core drill holes and an additional 16 pierce points in
13 LDD holes (certain holes provide 2 pierce points, entering and
leaving the pipe). Additional information on minimum shell
constraints are provided by the substantial internal LDD and core
drill coverage. The shell extends from surface (~1000 masl) to
a minimum elevation of 256 masl.
The M/PK(S) and EM/PK(S) internal domain models have been
significantly revised from those previously reported (see Lucara
Press Release of 15 December 2017).
The domains represent portions of the AK06 occupied primarily by
the M/PK(S) and EM/PK(S) units, respectively. Comparison of 2017
drill core geology with the historical geological model suggested
that the extent of the EM/PK(S) unit had previously been
substantially underestimated. This was confirmed by a review of the
historical South Lobe drill cores and the resultant updated domain
models indicate that the EM/PK(S) is the volumetrically dominant
unit below approximately 550 masl in the South Lobe.
Grade Estimates
Grade estimates above 600 masl are restated with minor
modifications from the previous Mineral Resource Estimate. Grades
are based on a well-distributed LDD sample dataset that supports
the interpolation of a local grade model into the block model.
Review of resulting grades derived using the historical grade
dataset highlighted anomalies where outlier sample grades result in
unrealistically high local estimates. A capping exercise was
therefore carried out to reduce the impact of these anomalous
values. This grade capping approach is similar to but slightly more
aggressive than previously reported (see Lucara Press Release
15 December 2017).
Below 600 masl grade has been estimated using a
microdiamond-based approach that is based on a calibration of the
ratio of microdiamond stone frequency (stones per kilogram) to + 1
mm LDD macrodiamond grade. The calibration was based on
LDD-recovered macrodiamond data and microdiamonds from adjacent
pilot hole drill core samples. Distributed microdiamond results
derived from spatially representative core drilling coverage of the
South Lobe below 600 masl were used in conjunction with the
established ratio of stone frequency to +1 mm LDD grade to derive
average grade estimates for the M/PK(S) and EM/PK(S) domains
present below 600 masl in the South Lobe.
The recovery efficiency of a production plant is variable and
modifications to the plant process and changing physical properties
of ore will affect the overall efficiency. The Karowe process plant
has undergone modifications since commencement of production in
2012. The most recent upgrades included installation of an XRT
circuit treating the 50 to 125 mm material prior to milling (to
reduce breakage of large diamonds) and the installation of an
additional XRT circuit to treat material in the size range 4 to 8
mm to reduce the load on the DMS. Recent production data have
therefore been used to derive an appropriate correction to convert
+1 mm LDD grades (estimated as outlined above) into +1.25 mm
recoverable grades for the Karowe plant in its current
configuration. A correction factor of -30% has been used for
conversion of all +1 mm LDD grade values to +1.25 mm grades
recoverable with the current Karowe plant.
The estimated grade of the deep portion of AK06 (below 600 masl)
has increased significantly relative to previously reported
estimates (see Lucara Press Release of 15
December 2017). This is due to a substantial increase in the
estimated proportion of the higher-grade EM/PK(S) domain which
represents 59% (by mass) of the pipe between 600 and 400 masl
compared to 23% of the pipe above 600 masl. This accounts for an
increase in the estimated average grade of remaining South Lobe
kimberlite from 12.7 cpht above 600 masl to 17.1 cpht between 600
and 400 masl.
Diamond Value
Diamond values estimates for each lobe are based on diamond size
frequency distribution (SFD) and diamond value distribution data
generated from 6 years of production. Valuation and sales data from
production have been used to define value distributions (US$/ct per
sieve size class) that were applied to SFD models (weight % carats
per sieve size class) for each lobe to generate average recoverable
(+1.25 mm) diamond value estimates (US $/ct). The value
distribution model for the -10.8 ct size range is based on reserve
prices generated by the Lucara Rough Diamond Price book adjusted to
reconcile with final sales results. The value distribution model
for the +10.8 ct size class is based on reserve and actual achieved
sales prices for single diamonds. The value estimates do not
include the two highest value diamonds to date, the Lesedi La Rona
(1,109 carats sold for US$ 53
million) and the Constellation (812 carats sold for
$US 63.11 million).
Table 2 Updated Estimates of Average Diamond Value
($US/ct)
Lobe
|
Average value
(US$/ct)*
|
North
|
222
|
Centre
|
367
|
South
|
716
|
* recoverable at 1.25 mm bottom cut-off) by
lobe
The revised modelled extent of the EM/PK(S) domain indicated the
probable exposure of EM/PK(S) in the current open pit and the
contact between the M/PK(S) and EM/PK(S) domains was subsequently
mapped (January 2018) where exposed
and accessible. This partially mapped contact was incorporated into
the domain model and this work supported the collection of a
controlled production bulk sample to confirm the SFD and establish
the presence of high value diamonds within the EM/PK(S). The
controlled production bulk sample of EM/PK(S) was carried out
between 9 and 20 February 2018. During this period a total of
79,052 tonnes were processed, from which 13,562 ct were recovered
yielding a grade of 17cpht. Furthermore,
- The sample returned 9.5 weight % carats of diamond larger than
10.8 ct;
- 47 diamonds greater than +10.8, including 1 diamond larger than
100 ct, and 6
diamonds larger than 50 ct
- A valuation report for the diamonds derived from the production
bulk sample (GTD Consulting, 2018) documents an estimated observed
average value of US$753 per ct
Results from this controlled production run provide confirmation
that the EM/PK(S) diamond population has an exceptionally
coarse-grained SFD with a high proportion of large high value
diamonds, equivalent to the well-established characteristics of the
diamond population derived from the M/PK(S) domain. Extension of
the EM/PK(S) unit upward into areas previously mined (but not
previously recognized as EM/PK(S) in the original geological model)
suggest that the unit has produced high value diamonds during
previous processing periods, including the 1,109 carat Lesedi
La Rona and the 812 carat Constellation diamonds in November 2015.
A single size distribution model and a single value distribution
model has been used to estimate average value in the South Lobe.
This approach may be revised as more discrete production and sales
results become available from the EM/PK(S) unit.
Next Steps
- Mineral Resource Update will be used for mine planning and to
support the preparation of feasibility-level studies for the
potential development of an underground mine
- An updated LOM open pit plan will be developed
- Additional studies to determine a drill program to increase
geological confidence in the resource below 400 masl
This press release has been reviewed and approved by Dr.
John Armstrong, PhD. P.Geol., VP
Mineral Resources of the Company and a "Qualified Person" for the
purposes of NI 43-101.
CONFERENCE CALL:
The Company will host a conference call and webcast to discuss
the Mineral Resource Update on Wednesday,
June 27, 2018, at 6:00 a.m.
Pacific, 9:00 a.m. Eastern,
2:00 p.m. UK, 3:00 p.m. CET.
Please call in 10 minutes before the conference call starts and
stay on the line (an operator will be available to assist you).
Conference ID:
9289567 / Lucara Diamond
Dial-In Numbers:
Toll-Free Participant Dial-In North America: +1-844-892-6587
All International Participant Dial-In: +1-661-378-9938
Webcast
To view the live webcast presentation, please log on using this
direct link:
https://edge.media-server.com/m6/p/d6q7gkxr
The presentation slideshow will also be available in PDF format
for download from the Lucara website www.lucaradiamond.com shortly
prior to the conference call.
On behalf of the Board,
Eira Thomas
President and Chief Executive Officer
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ABOUT LUCARA
Lucara is a leading independent producer of large exceptional
quality Type IIa diamonds from its 100% owned Karowe Mine in
Botswana. The Company has an
experienced board and management team with extensive diamond
development and operations expertise. The Company operates
transparently and in accordance with international best practices
in the areas of sustainability, health and safety, environment and
community relations.
ABOUT CLARA
Clara Diamond Solutions (Clara), wholly owned by Lucara Diamond
Corp, is a secure, digital sales platform that uses proprietary
analytics together with cloud and blockchain technologies to
modernize the existing diamond supply chain, driving efficiencies,
unlocking value and ensuring diamond provenance from mine to
finger.
The information in this release is accurate at the time of
distribution but may be superseded or qualified by subsequent news
releases.
This information is information that Lucara Diamond Corp. is
obliged to make public pursuant to the EU Market Abuse Regulation.
The information was submitted for publication, through the agency
of the contact person set out above, on June
26, 2018 at 1:15 p.m. Pacific
Time.
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
Certain of the statements made and contained herein and
elsewhere constitute forward-looking statements as defined in
applicable securities laws. Generally, these forward-looking
statements can be identified by the use of forward-looking
terminology such as "expects", "anticipates", "believes",
"intends", "estimates", "potential", "possible" and similar
expressions, or statements that events, conditions or results
"will", "may", "could" or "should" occur or be achieved.
Forward looking statements are based on the opinions and
estimates of management as of the date such statements are made,
and they are subject to a number of known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. The
Company believes that expectations reflected in these
forward-looking statements are reasonable, but no assurance can be
given that these expectations will prove to be correct and such
forward-looking statements included herein should not be unduly
relied upon. In particular, this release may contain forward
-looking statements pertaining to the following: the estimates of
the Company's mineral reserves and resources, including the
assumptions and estimates underlying such mineral reserve and
resource estimates; estimates of the Company's production
capabilities, processing capabilities, recovery rates, cash flows
and sales volumes for the Karowe Project, including the potential
effect of the development and integration of the proposed
underground mine at the Karowe Project on production, sales volumes
and the expected LOM of the Karowe Project; estimated costs to
construct the proposed Karowe Underground development at the Karowe
Project, expected start-up, exploration and development plans and
mine designs at the Karowe Project, and the timelines associated
therewith, and objectives, expected production costs, expected
exploration and development expenditures and expected reclamation
costs at the Karowe Project, including such plans, objectives and
economic estimates, including cost and expenditure estimates, used
in or arising from the PEA or in relation to the proposed Karowe
Underground project; the expected completion date of open-pit
operations at the Karowe Mine; the expected completion of an
updated mineral resource estimate and a PFS at the Karowe Project;
expected Karowe Project enhancement opportunities resulting from
the Karowe Underground PEA; expectations regarding diamond prices
and changes to foreign currency exchange rates; expectations
regarding the need to raise capital; possible impacts of disputes
or litigation and other risks and uncertainties describe under
Risks and Uncertainties disclosed in the Company's Annual
Information Form.
There can be no assurance that such statements will prove to be
accurate, as the Company's results and future events could differ
materially from those anticipated in these forward-looking
statements as a result of those factors discussed in or referred to
under the heading "Risk Factors" in the Company's most recent
Annual Information Form available at http://www.sedar.com, as well
as changes in general business and economic conditions, changes in
interest and foreign currency rates, the supply and demand for,
deliveries of and the level and volatility of prices of rough
diamonds, costs of power and diesel, acts of foreign governments
and the outcome of legal proceedings, inaccurate geological,
development and recoverability assumptions (including with respect
to the size, grade and recoverability of mineral reserves and
resources), unanticipated delays in the completion of the updated
mineral resource estimate and PFS at the Karowe Project;
unanticipated events relating to the development of the proposed
Karowe Underground project; unanticipated operational difficulties
(including the failure of plant, equipment or processes to operate
in accordance with specifications or expectations, or the failure
of the Company to effectively integrate the proposed Karowe
Underground with existing operations at the Karowe Project), cost
escalations, unavailability of materials and equipment, government
action or delays in the receipt of government approvals, industrial
disturbances or other job actions, adverse weather conditions, and
unanticipated events relating to health, safety and environmental
matters).
Accordingly, readers are cautioned not to place undue reliance
on these forward-looking statements which speak only as of the date
the statements were made, and the Company does not assume any
obligations to update or revise them to reflect new events or
circumstances, except as required by law.
For further
information, please contact:
|
|
|
Investor and Public
Relations
|
+1-604 689-7842,
info@lucaradiamond.com
|
Sweden: Robert
Eriksson, Investor Relations
|
+46-701-112615,
reriksson@rive6.ch
|
UK: Louise Mason,
Citigate Dewe Rogerson
|
+44(0)20 7282 2932
Louise.Mason@Citigatedr.co.uk
|