DiamondCorp (AIM: DCP, JSE: DMC) said it has strengthened its management team with the appointment of Keith McCulloch as general manager of the Lace mine in South Africa. McCulloch’s primary responsibility will be the implementation of the decline and mine development plan designed by Snowden Mining Industry Consultants.
Previously, the company said that the decline will be used for the initial haulage of kimberlite from below the sub-240m level. Kimberlite will be used for bulk testing purposes and for the implementation of the sub-level caving mine plan.
Production at Lace is scheduled to increase to 1.2 million tonnes per annum once the existing 6x2.7m vertical shaft is re-equipped during 2011 for primary ore hoisting. Subsequently the decline will then be utilised for men, materials and ventilation for the remainder of the +25-year life of the mine.
DiamondCorp noted that McCulloch is a highly experienced mining engineer with almost 30 years experience in underground and opencast mining operations in South Africa, Zimbabwe and Swaziland, predominantly in the diamond sector.
Last month, after the successful completion of an earlier £7.1 million placing, DiamondCorp resumed the development of the Lace diamond mine, located in the Free State Province of South Africa. “Following one of the most difficult years on record for the diamond sector, we have been able to keep the 1.2 million tonne per annum recovery plant and full underground mining fleet in place and in good working order”, DiamondCorp MD & CEO Paul Loudon commented.
“We look forward to accessing the potential 13 million carats in resource at Lace in early 2011, and building up to a potential production of between 400,000 and 500,000 carats per annum at the same time as the long-term metrics for the diamond industry continue to improve.”
Elsewhere, DiamondCorp is earning a 77.5% interest in various exploration licenses in Botswana from Geoperspectives Pty, by funding exploration activities. Last month, the company said that preparations are being finalised for the start of a six-hole diamond drilling program on two kimberlite targets – J-05 and J-12.
Diamondcorp highlighted that the J-05 and J-12 kimberlite targets are located approximately 5.5km southeast of De Beers Jwaneng mine, which it noted was the world’s richest diamond mine measured by value.
The 2010 program follows the successful delineation of a 10 hectare diamondiferous kimberlite J-01 during the an initial drilling program in late 2009.
Broker Fairfax mentioned DiamondCorp in its 'Daily Market report', noting McCulloch's appointment. "That a senior experienced GM has joined the team is a vote of confidence in the Lace project and should help reassure investors over concerns over development risk for Lace."
There is considerable relevant experience within the management team that should ensure that operational risk is minimised. As developments progress with the decline then a lower discount rate on the project will be appropriate, Fairfax added.
Disclosure: The author holds no positions in the company