YELLOWKNIFE, Nov. 26, 2014 /PRNewswire/ - Dominion
Diamond Corporation (TSX: DDC, NYSE: DDC) (the "Company" or
"Dominion") reports that Rio Tinto plc, the parent company of the
operator of the Diavik Diamond Mine (Diavik Diamond Mines (2012)
Ltd. ("DDMI")), has approved the development of the A-21 pipe at
the Diavik Diamond Mine, in which the Company holds a 40% stake.
DDMI has estimated the total capital cost for the development of
the A-21 pipe to be approximately US$350
million at the Company's estimated Canadian/US dollar
exchange rate of $1.11 (on a 100%
basis), with the Company's share being US$140 million. The A-21 resource is well
understood, and A-21 diamond production is planned for late
calendar 2018. The A-21 production will provide an important source
of incremental supply for Diavik, ensuring the continuation of
existing production levels.
The A-21 ore body is located under a lake requiring construction
of a dike to isolate the open pit operations. The bulk of the
requisite infrastructure for the A-21 pipe is already in place from
the previous dike construction and pit operations at the Diavik
Diamond Mine, and the necessary operating licenses and agreements
are in place for project implementation. The A-21 ramp up is
anticipated to commence immediately, with the first equipment and
supplies scheduled to be transported in early 2015 to the Diavik
mine site on the seasonal winter ice road. Four years of dike
construction and pre-stripping (2015-2018) are expected to be
followed by approximately five years of open-pit mining. The
Diavik Joint Venture has approved the 2015 programme of
works. Expenditure on the development of the A-21 pipe in
2015 will relate to crushing costs, pipeline construction and
initial dike foundation and abutment work in preparation for
expected dike construction during the 2016 and 2017 summer seasons.
Pre-stripping of the open pit is expected to commence in 2018
following dewatering of the pool within the dike.
DDMI has estimated that the A-21 pipe contains (on a 100% basis)
3.6 million tonnes of measured resources, at a grade of 2.8 carats
per tonne, and 0.4 million tonnes of indicated resources at a grade
of 2.6 carats per tonne. These estimates are as of December 31, 2013. Mineral resources that are not
mineral reserves do not have demonstrated economic viability. The
Company intends to publish a detailed summary of the updated
reserves only mine plan for the Diavik Diamond Mine, plus A-21,
once these have been approved by DDMI. The Company expects to
receive an updated estimate of the mineral reserves and mineral
resources at the Diavik Diamond Mine from DDMI in the first
calendar quarter of 2015.
Using the prices from the Company's September 2014 rough diamond sale and the current
diamond recovery profile of the Diavik processing plant, the
Company has modeled the approximate rough diamond price per carat
for the A-21 pipe to be approximately US$145 per carat.
Forward-Looking Information
Information included herein that is not current or historical
factual information, including information about estimated mine
life and other development plans regarding mining activities at the
Diavik Diamond Mine, estimated resources at the A-21 pipe,
projected capital costs, and future diamond prices, constitute
forward-looking information or statements within the meaning of
applicable securities laws. Forward-looking information can
generally be identified by the use of terms such as "may", "will",
"should", "could", "expect", "plan", "anticipate", "foresee",
"appears", "believe", "intend", "estimate", "predict", "potential",
"continue", "objective", "modeled", "hope", "forecast" or other
similar expressions concerning matters that are not
historical facts. Forward-looking information is based on
certain factors and assumptions including, among other things,
mining, production, construction and exploration activities at the
Diavik Diamond Mine; mining methods; currency exchange rates;
estimates related to the capital expenditures required to bring the
A-21 pipe into production, required operating and capital costs;
labour and fuel costs; world and US economic conditions; future
diamond prices; and the level of worldwide diamond production.
These assumptions may prove to be incorrect. Forward-looking
information is subject to certain factors, including risks and
uncertainties which could cause actual results to differ materially
from what the Company currently expects. These factors include,
among other things, the uncertain nature of mining activities,
including risks associated with underground construction and mining
operations, risks associated with joint venture operations, risks
associated with the remote location of and harsh climate at the
Diavik Diamond Mine, risks resulting from the Eurozone financial
crisis, risks associated with regulatory requirements, the risk of
fluctuations in diamond prices and changes in US and world economic
conditions, the risk of fluctuations in the Canadian/US dollar
exchange rate and cash flow and liquidity risks. Actual results may
vary from the forward-looking information. Readers are cautioned
not to place undue importance on forward-looking information, which
speaks only as of the date of this disclosure, and should not rely
upon this information as of any other date. Due to assumptions,
risks and uncertainties, including the assumptions, risks and
uncertainties identified above and elsewhere in this disclosure,
actual events may differ materially from current expectations. The
Company uses forward-looking statements because it believes such
statements provide useful information with respect to the currently
expected future operations and financial performance of the
Company, and cautions readers that the information may not be
appropriate for other purposes. While the Company may elect to, it
is under no obligation and does not undertake to, update or revise
any forward-looking information, whether as a result of new
information, future events or otherwise at any particular time,
except as required by law. Additional information concerning
factors that may cause actual results to materially differ from
those in such forward-looking statements is contained in the
Company's filings with Canadian and United States securities regulatory
authorities and can be found at www.sedar.com and www.sec.gov,
respectively.
Qualified person
The scientific and technical information contained in this press
release has been prepared by Diavik Diamond Mines (2012) Inc.,
operator of the Diavik Diamond Mine, under the supervision of
Calvin Yip, P. Eng., Principal
Advisor, Strategic Planning of Diavik Diamond Mines (2012) Inc.,
and a Qualified Person within the meaning of National Instrument
43-101 of the Canadian Securities Administrators.
About Dominion Diamond Corporation
Dominion Diamond Corporation is a Canadian diamond mining
company with ownership interests in two major producing
diamond mines. Both mines are located in the low political
risk environment of the Northwest
Territories in Canada.
The Company operates the Ekati Diamond Mine through its 88.9%
ownership as well as a 65.3% ownership in the surrounding areas
containing additional resources, and also owns 40% of the
Diavik Diamond Mine. It supplies rough diamonds to the global
market through its sorting and selling operations in Canada, Belgium and India and is the world's third largest
producer of rough diamonds by value.
For more information, please visit
www.ddcorp.ca
SOURCE Dominion Diamond Corporation