KIMBERLEY DIAMOND COMPANY NL
Quarterly Report
For the Period Ended 30 JUNE 2007
asx code: kim
AIM CODE: KDC
OVERVIEW
* Record 1,514,000 tonnes treated in June 2007 quarter with 544,000 tonnes in
June alone. Total production of 4.80 million tonnes treated for full
financial year (up from 2.1 million tonnes in the year ended June 2006).
Comprising 2.03 million tonnes from Pipe 9 and 2.77 million tonnes from
Pipe 4.
* 110,000 carats produced in June 2007 quarter. 378,000 carats produced for
full financial year (152,000 carats for year ended 30 June 2006) and
364,000 carats sold.
* Average grade 7.9 carats per hundred tonnes (cpht) for full financial year
(7.2 cpht year ended 30 June 2006).
* Run-of-mine sales average A$171 per carat (A$234 year ended 30 June 2006);
generating revenue of A$62.3 million for the financial year (A$34.1 million
year ended 30 June 2006).
* 41 percent increase in Ellendale 9 Resource to 29.3 million tonnes at 5.4
cpht for 1.6 million carats contained with present inground value of A$498
million to depths of 130 metres only from surface (average A$17 per tonne).
* Unit site operating costs now around A$12.50 per tonne (based on June
production).
1. 41% Increase in Ellendale 9 Resource - Predominantly High Value Ellendale 9
East
* Updated resource 29.3 million tonnes at 5.4cpht for 1.6 million carats.
* A significant proportion of the increase comes from the Eastern Lobe of
Pipe 9, which produces the highest value diamonds at Ellendale (US$370/ct).
* Updated mining model being prepared with the additional tonnages of ore
expected to significantly improve the waste:ore ratio, resulting in lower
unit mining costs than previously expected.
* Diamond core drilling planned to test other lithologies within Ellendale
Pipe 9 with the potential to further increase the resource.
The revised resource statement for Ellendale 9 as at 1 June 2007 is set out
below.
ELLENDALE 9 RESOURCE STATEMENT AT 1 JUNE 2007
Resource Classification Tonnes Carats Grade(cpht)
Western Lobe
Measured 4,310,000 289,300 6.7
Indicated 8,516,000 497,000 5.8
Inferred 3,385,000 207,000 6.1
Subtotal 16,211,000 993,300 6.1
Eastern Lobe
Measured 335,000 19,900 5.9
Indicated 3,442,000 159,400 4.6
Inferred 9,306,000 416,200 4.5
Subtotal 13,083,000 595,500 4.6
Ellendale 9 Total
Measured 4,645,000 309,200 6.7
Indicated 11,958,000 656,400 5.5
Inferred 12,691,000 623,200 4.9
Total 29,294,000 1,588,800 5.4
NOTES
1. Resources depleted to May 2007.
2. The resource has been calculated from aircore drilling (to establish
lithologies) and large diameter drilling to define grade.
3. For the resource, diamonds were recovered in the 1.2 to 14mm range.
4. Diamond values have been established from sales of production and mine
development diamonds in Antwerp over the past 5 years. A value for Eastern
Lobe diamonds has been established at US$370/ct and at US$200/ct for the
Western Lobe. The variation in value is related to size distribution and
assortment characteristics.
5. Resource classification complies with JORC (2004).
6. All material logged as UBX has been classified as Inferred because of
uncertainties in grade distribution for this unit.
7. Rounding of tonnes to the nearest 1,000 and carats to the nearest 100 may
result in computational discrepancies in the statement.
8. Insitu resource does not include metallurgical recovery factors, mining
dilution or change in bottom screen size in production plants.
9. The resource has been calculated with a 0 carats per hundred tonnes (cpht)
cut-off.
10. The resource has been calculated down to a reduced level (RL) of 0 metres
above mean sea level. This equates to about 130m below the initial land
surface.
2. Production Statistics
* Record 1,514,000 tonnes treated for the June quarter (including Ellendale 9
East Plant commissioning period finalised during June).
* Combined plant treatment rates have improved by 30 percent from the end of
the March quarter to the end of the June quarter, significantly by 74
percent on the Ellendale 9 East Plant and 15 percent on the Ellendale 4
South Plant.
* 110,000 carats recovered. Recovered grade reduced in line with higher
throughput from Ellendale 9 (Ellendale 9 is a lower grade but higher value
per tonne ore body than Ellendale 4).
* 2006/2007 Financial Year production of 378,000 carats from 4,796,000 tonnes
treated at an average grade of 7.9cpht (2005/2006: 152,000 carats from
2,112,000 tonnes treated at 7.2cpht).
* Strong evidence supporting the impact of increased throughput rates on
reducing unit operating costs. Unit site operating costs now around $12.50/
tonne at an annualised rate of 6.8mtpa (based on June ore processed).
Medium term target of approximately $11-12/tonne once the current expansion
projects achieve steady state production.
3. Ellendale 4 South Plant
* 923,000 tonnes processed for the quarter to make three successive quarters
of record production (March quarter: 844,000 tonnes, December quarter:
786,000 tonnes).
* Planned installation of an additional crusher in the second half of 2007 to
remove bottleneck in the crushing circuit which should allow further
increased throughput.
4. Ellendale 9 East Plant Expansion
* Reinstallation of the scrubber and rolls crusher to complete the East Plant
Expansion program to allow production to ramp-up to 450tph (3.3mtpa).
* All modules are now in place and throughput rates have immediately improved
with the scrubber and rolls crusher installations.
5. Marketing
* Year-to-date Company sales of 363,600 carats at US$134/carat (A$171/carat),
realising revenue of A$62.3 million (2005/2006: A$34.1 million).
* Continued strong value results from direct sales and tenders in the June
quarter marking recovery of the international rough diamond market,
particularly for gem quality product such as that produced at Ellendale.
* June quarter sales, as well as full year sales, included a product mix
abnormally weighted towards the lower value Ellendale 4 diamonds due to the
East Plant upgrade shutdown and extended commissioning.
6. Corporate
* On 7 May 2007 Gordon Gilchrist was appointed as an Executive Director of
the Company. Mr Gilchrist was the previous Managing Director of Argyle
Diamond Mines and subsequently Managing Director of Rio Tinto Diamonds.
* A$14.39 million capital raising completed through the issue of 20,558,500
fully paid ordinary shares pursuant to a placement with sophisticated
investors at a price of $0.70 per share. Proceeds were partially applied to
further bank debt reduction, with net debt reduced to A$23.8 million.
Remainder of funds have and are to be used towards new environmental
bonding and plant remediation works at the Ellendale 9 East Plant.
* A$5.00 million scheduled repayment of Project Debt completed on 29 June
2007.
* On 15 May 2007, 1,000,000 unlisted options exercisable at $0.80 expiring on
the third anniversary of the date of grant were issued to Soci�t� G�n�rale
Australia Branch in accordance with terms and conditions of a letter
agreement relating to adjustments to the Company's financing facilities.
7. Operating Update
Production Statistics - Quarter
Plant Performance Ellendale 9 Ellendale 4 Total
Ore processed (tonnes)
April 184,000 277,000 461,000
May 207,000 319,000 526,000
June 230,000 327,000 557,000
TOTAL 622,000 923,000 1,544,000
Ore treated (tonnes)
April 178,000 277,000 455,000
May 196,000 319,000 514,000
June 217,000 327,000 544,000
TOTAL 591,000 923,000 1,514,000
Carats recovered 24,500 85,300 110,000
Treated grade (cpht) 4.2 9.3 7.3
Production Statistics - Year to Date
Plant Performance Ellendale 9 Ellendale 4 Total
Ore processed (tonnes)
September quarter 685,000 220,000 904,000
December quarter 418,000 786,000 1,205,000
March quarter 439,000 844,000 1,283,000
June quarter 623,000 923,000 1,544,000
TOTAL 2,164,000 2,773,000 4,937,000
Ore treated (tonnes)
September quarter 647,000 219,000 867,000
December quarter 382,000 784,000 1,166,000
March quarter 407,000 843,000 1,250,000
June quarter 591,000 923,000 1,514,000
TOTAL 2,027,000 2,769,000 4,796,000
Carats recovered 107,400 269,500 378,000
Treated grade (cpht) 5.3 9.7 7.9
NOTES:
*Rounding of tonnes to the nearest 1,000 and carats to the nearest 100 may
result in computational discrepancies in these tables.
*Total carats recovered includes minor carat recoveries from audit process.
8. Mining Tenements
Schedule of Mining Tenements - 30 June 2007
Tenement Area(km2) Date of Kimberley
Grant Interest
Ellendale Mining Lease M04/372 123.9 23/11/99 100%
1L04/26 1.6 01/12/04 100%
1L04/48 2.3 18/02/05 100%
Blina Project 2ELA/1098 176.1 Application 100%
1 Miscellaneous Licences covering Roberts Road access to the Mining Lease.
2 Application (purchased by Blina Diamonds NL) will be transferred 12 months
after grant.
MILES KENNEDY
CHAIRMAN
10 July 2007
The geological information in this report that relates to exploration results
is based on information compiled by the Company's Chief Geologist, David Jones
of Ascidian Prospecting Pty Ltd, who is a corporate member of The Australasian
Institute of Mining and Metallurgy. He has sufficient experience which is
relevant to the style of mineralisation and type of deposit under consideration
and to the activity which he is undertaking to qualify as a Competent Person as
defined in the December 2004 edition of the "Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves" (JORC Code). Mr Jones
consents to the inclusion in the report of the matters based upon his
information in the form and context in which it appears.
The Australian Stock Exchange has not reviewed and does not accept
responsibility for the accuracy or adequacy of this release.
The Company*s Nominated Advisor is RFC Corporate Finance Ltd, contact Steve Allen or Stuart Laing
* Ph: +618 9480 2500.
KIMBERLEY DIAMOND COMPANY NL ABN 91 061 899 634
12 WALKER AVENUE WEST PERTH 6005 WESTERN AUSTRALIA PO BOX 806 WEST PERTH
WESTERN AUSTRALIA 6872
TEL (+61-8) 9321 5887 FAX (+61-8) 9321 5884 EMAIL general@kimres.com.au
WWW www.kimberleydiamondco.com.au
END
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