DiamondCorp Sells Diamonds Intended For Antwerp Tender After Price Exceeded

Rough Market
15/06/2016 08:25

DiamondCorp reported that two run-of-mine parcels of diamonds which would have formed part of a larger diamond tender in Antwerp scheduled to commence at the end of this month have been sold to South African diamantaires when the company's reserve prices were exceeded during the South African export process. The two parcels comprised 1,838 carats of run-of-mine kimberlite diamonds and 1,679 carats of tailings diamonds, and were sold for an average of $189 per carat and $53 per carat, respectively. Total proceeds received from the sale were almost $440,000.

DiamondCorp CEO Paul Loudon said: "The company undertakes regular diamond exports from South Africa in order that its diamonds are sorted and prepared for tender sale in Antwerp. Every tender comprises several export shipments, the process of which each time involves a four-day window when South African licensed diamantaires may bid for the production. If the reserve prices placed by DiamondCorp on the parcels are exceeded during this four-day period, then the company is obliged to sell the diamonds to the highest bids rather than exported. The company's reserve prices must be market-related.

"Pleasingly, the latest selling price is the highest achieved to date for run of mine Lace kimberlite diamonds and underlines the conservative nature of the $164 per carat base case in the company's resource statement and financial models. The higher price is a reflection both of the increase in the plant bottom screen size from 1.00 mm to 1.25 mm and the recovery of a higher than forecast frequency of diamonds greater than 4 carats in size."

DiamondCorp added that it will monitor the rate of rough diamond build-up from the first month of full production from the UK4 Block during July and determine the best date to re-schedule the next Antwerp tender to maintain regular cashflow until steady state monthly tender sales are achieved. It expects that two further tenders will take place before regular monthly sales commence at the end of September and the company remains on track to produce more than 75,000 carats of diamonds from kimberlite in 2016.