Lucara Diamond Corporation produced its first diamonds from the Karowe mine in Botswana. More than 5,300 carats of diamonds were recovered from ore mined from the upper benches of the north lobe of the deposit, which has an estimated grade of greater than 32 carats per hundred tonnes (cpht). Lucara recovered four special-size stones larger than 10.8 carats, the three largest of which were 25.88 carats, 16.55 carats and 14.56 carats. Lucara intends to have its first sale of diamonds recovered from the Karowe during the first two weeks of June 2012.
William Lamb, the president of Lucara Diamond, said, “The successful ore commissioning and recovery of the first production diamonds, especially including some high quality large diamonds, is an exciting time for the entire construction and operations team. The diamonds recovered show some very strong crystal shapes which we look forward to providing to the market in June. Diamond production and the processing of ore through the entire plant signals the transition of Lucara to a producing company – this is a very proud moment for us all.”
In funding news, Lucara Diamond signed a definitive agreement with The Bank of Nova Scotia for a $25 million revolving-term credit facility with a maturity date of March 16, 2014, which may be extended. Up to $15 million is available immediately with the balance available following delivery of security over the company’s Karowe assets, which is expected during the second quarter of this year.
The facility contains financial and non-financial covenants customary for a facility of this size and nature. The applicable interest rate of any loan under the facility will be determined by the company’s leverage ratio at any given time. The two-year facility will be secured by the company’s Karowe assets and guaranteed by its subsidiaries which hold the Karowe assets. Lucara intends to use the facility to fund ongoing operations primarily at the Karowe mine.