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Lucara Diamond Corp. has provided an update on the Karowe Underground Expansion project (the UGP). The Karowe UGP is designed to access the highest value portion of the Karowe orebody, extend mine life to at least 2040 and deliver approximately US$4 billion in additional revenues using conservative diamond price assumptions which are unescalated and exclude exceptional stone revenues.
Management initiated an update to the UGP schedule and budget in response to slower than planned ramp up to expected sinking rates, and, to account for time incurred to date, as well as for anticipated future grouting programs.
Grouting programs took longer than anticipated due to a combination of high-water volumes in the sandstone lithologies between 870 and 752 m above sea level in depth (144 m to 262 m below the shaft collar) combined with technical challenges associated with the transition to main sinking.
The updated schedule incorporates a 28% increase in the duration of construction, extending the anticipated commencement of production from the underground from 2H26 to 1H28. As a result, the revised forecast of costs at completion is US$683 million, a 25% increase to the May 2022 estimated capital cost of US$547 million.
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