TIDMFDI
RNS Number : 1118N
Firestone Diamonds PLC
21 October 2016
21 October 2016
Firestone Diamonds plc
("Firestone", the "Group" or the "Company") (AIM: FDI)
Liqhobong Diamond Mine Commences Production Ramp-up
Firestone Diamonds plc, the AIM-quoted diamond company, is
pleased to provide its quarterly update on activities at its
Liqhobong Diamond Mine ("Liqhobong" or the "Project") as at the end
of September 2016 and to also announce the recovery of the first
diamonds as the Project moves into the production ramp-up phase.
Liqhobong is owned 75% by Firestone and 25% by the Government of
Lesotho.
Post period: Ramp-up production highlights as at 20 October
2016
-- Recovery of first diamonds
- First ore treated through plant as scheduled with diamonds reporting to the sort house
- Initial recoveries are as expected and confirm presence of fancy yellow diamonds
-- Commissioning at 96% complete
-- First ore blast in the main pit successfully completed
-- Waste stripping on target
-- Ramp-up to commercial production now commenced
- Production guidance for financial year ending June 2017
remains as announced in July 2016, with 1.8 to 2 million tonnes
("Mt") treated and between 380,000 and 450,000 carats recovered
- Full production rates expected to take at least six months
Construction highlights as at the end of September 2016
-- All major construction activities complete
-- Plant 91% commissioned, ahead of revised target of 50%
-- Revised capital budget of ZAR2.1 billion, remains within the
original project budget of US$185.4 million
-- Zero lost time injury record maintained, with approximately 3.2 million man hours worked
Stuart Brown, Chief Executive Officer, commented:
"It is extremely exciting to have reached the end of the
construction phase and to start the next chapter of the Liqhobong
Diamond Mine, as we ramp-up production to become a one million
carat per annum producer.
Discovered in the 1950's this exciting diamond deposit is on the
cusp of entering commercial production and I commend the team for
completing construction ahead of revised schedule and achieving
over three million man hours without a lost time injury - a truly
exceptional accomplishment."
Project Update
Liqhobong has completed all major construction activities and at
the end of September 2016 the Project was 98% complete and well
ahead of schedule. The teamwork and cooperation of all staff and
contractors has allowed the Project to achieve commissioning well
ahead of plan. The commissioning phase was 91% complete at the end
of the quarter and we have been able to commence the ramp-up to
commercial production.
The remaining 2% of the Project construction relates to minor
construction activities, such as cladding and final non-essential
items, which will all be completed before the end of 2016.
Health & Safety
At the end of the quarter, the Project had maintained its
remarkable safety record, having reached 3.2 million man hours
worked without a single Lost Time Injury.
Financial
The Project continues to remain within the original US$185.4
million budget and as at 30 September 2016, ZAR1.8 billion (US$157
million) or 83% had been spent on the Project against the revised
capital budget of ZAR2.1 billion. The cash on hand at the end of
September 2016 was US$4.6 million and the Company also had US$29.0
million available pursuant to the ABSA debt facility, resulting in
forecast headroom available to the Company of approximately US$9.0
million as at the end of December 2016. This does not include the
US$15.0 million standby facility available to the Company.
Production Guidance
Following the completion of all major construction and
commissioning stages, the production ramp-up phase has now
successfully started. As per the announcement of 20 July 2016,
Firestone anticipates that the ramp up process to full nameplate
capacity, being 3.6 million tonnes per annum or 500 tonnes per hour
to recover up to 1 million carats per annum, will take at least six
months.
As set out previously, during the initial ramp-up phase, ore
from mixed low grade stockpiles and diluted ore from the main pit
will be processed through the plant. The variability of this ore
will therefore influence the recovery of run of mine carats and it
is difficult at this stage to predict the average dollar per carat
that will be achieved from the early diamond sales. The Company
expects to treat between 1.8 and 2.0 Mt of ore, recovering between
380,000 and 450,000 carats, during the financial year ending June
2017. Costs are projected to be in the region of US$12 to US$14 per
tonne processed.
Diamond Recovery
Diamonds recovered to date are in line with the low grade
stockpiles and diluted ore that has been fed through the plant.
Pleasingly the first fancy yellow diamond has been recovered. As
the Company continues with the ramp-up of production and begins
treatment of run of mine ore from the main pit, Firestone expects
that the quality and size of the diamonds recovered will
improve.
Diamond Sales
Firestone has scheduled its first diamond sale to take place in
Antwerp in January 2017. The sale will complete early in February
2017. Thereafter the Company expects to host two sales per quarter.
As the Company increases production through the ramp-up phase and
begins to treat larger volumes of kimberlite from the main pit, it
will obtain an enhanced understanding of the occurrence and value
of large stones over time.
Image Gallery
Each month the Company updates its media gallery to include
images to illustrate the Project's progress and these can be found
on Firestone's website: www.firestonediamonds.com/media.
For more information contact:
+44 (0)20 8741
Firestone Diamonds plc 7810
Stuart Brown
Strand Hanson Limited +44 (0)20 7409
(Nomad) 3494
Stuart Faulkner
Richard Tulloch
James Dance
Macquarie Capital (Europe) Limited (Joint
Broker)
+44(0)20 3037
Raj Khatri 2000
Nick Stamp
Mirabaud Securities LLP
(Joint Broker)
+44 (0)20 7878
Rory Scott 3360
+44 (0)20 7878
Ed Haig-Thomas 3447
Tavistock (Public and +44 (0)20 7920
Investor Relations) 3150
Emily Fenton +44 (0)7788 554
Jos Simson 035
Barney Hayward
Background information on Firestone
Firestone is an international diamond mining company with
operations focused on Lesotho. Firestone is currently in the
process of commencing production at the Liqhobong Diamond Mine in
Lesotho to become a one million carat per annum producer.
Lesotho is emerging as one of Africa's significant new diamond
producers, hosting Gem Diamonds' Letseng Mine, Firestone's
Liqhobong Mine and Namakwa Diamonds' Kao Mine.
For more information please visit:
www.firestonediamonds.com.
**ENDS**
This information is provided by RNS
The company news service from the London Stock Exchange
END
UPDBLBDGDXDBGLG
(END) Dow Jones Newswires
October 21, 2016 02:00 ET (06:00 GMT)
Firestone Diamonds (LSE:FDI)
Historical Stock Chart
From Mar 2024 to Apr 2024
Firestone Diamonds (LSE:FDI)
Historical Stock Chart
From Apr 2023 to Apr 2024