YELLOWKNIFE, Northwest Territories -- (Business Wire)
Dominion Diamond Corporation (TSX: DDC, NYSE: DDC) (the “Company” or
“Dominion”) is pleased to release an updated reserves and resources
statement and an updated “reserves-only” life of mine plan for the
Diavik Diamond Mine.
Unless otherwise specified, all financial information is presented in
Canadian dollars, on a 100% basis, and references to years are to
calendar years. The Company has a 40% interest in the Diavik Diamond
Mine.
The updated reserves and resources statement adds an additional 3.9
million tonnes containing approximately 13.0 million carats to the
mineral reserves. As of December 31, 2014, the Diavik Diamond Mine had
18.1 million tonnes of proven and probable mineral reserves containing
53.3 million carats of diamonds (compared to 16.4 million tonnes of
proven and probable mineral reserves containing 46.8 million carats as
of December 31, 2013).
At the A-21 pipe, 3.7 million tonnes containing 10 million carats has
been promoted to proven reserve material. In addition, at the A-154
North pipe, 0.24 million tonnes of inferred resources at depth were
promoted to probable mineral reserve status. Within the remaining
reserve at the A-154 North pipe, 0.5 million tonnes were promoted from
probable reserve to proven reserve,supported by sampling in the
active mine which improved confidence for production forecasting.
Routine mine sampling, delineation drilling and mine surveying have
increased forecast grade to the existing mineral reserves at the A-154
South, A-154 North and A-418 pipes.
The tables below summarize the mineral reserves and mineral resources at
the Diavik Diamond Mine as at the end of December 31, 2014, expressed in
millions of tonnes, carats per tonne, and millions of carats. The
mineral reserves, set out in Table 1 below, account for all depletions
due to production and sampling to the end of December 31, 2014, and the
increase in the reserves as described above. Totals may not add up
exactly due to rounding. The values shown are on a 100% basis for the
Diavik Joint Venture.
Table 1 – Mineral Reserves at the Diavik Diamond Mine – December 31,
2014 (100% basis)
|
|
| Proven |
|
|
| Probable |
|
|
| Proven + Probable | |
Pipe | | | Mineral Reserve |
|
|
| Mineral Reserve |
|
|
| Mineral Reserve | |
|
|
|
Mt
|
|
cpt
|
|
Mct
|
|
|
|
Mt
|
|
cpt
|
|
Mct
|
|
|
|
Mt
|
|
cpt
|
|
Mct
| |
A154N
| | |
5.0
|
|
2.3
|
|
11.5
| | | |
2.1
|
|
2.2
|
|
4.5
| | | |
7.0
|
|
2.3
|
|
16.1
| |
A154S
| | |
0.9
| |
4.0
| |
3.7
| | | |
0.9
| |
3.4
| |
3.1
| | | |
1.8
| |
3.7
| |
6.7
| |
A418
| | |
3.5
| |
4.1
| |
14.3
| | | |
2.1
| |
2.9
| |
6.1
| | | |
5.5
| |
3.7
| |
20.4
| |
A21
| | |
3.7
| |
2.7
| |
10.0
| | | |
---
| |
---
| |
---
| | | |
3.7
| |
2.7
| |
10.0
| |
Stockpile
|
|
|
0.02
|
|
3.1
|
|
0.1
|
|
|
|
---
|
|
---
|
|
---
|
|
|
|
0.02
|
|
3.1
|
|
0.1
| |
Totals |
|
| 13.1 |
| 3.0 |
| 39.6 |
|
|
| 5.0 |
| 2.7 |
| 13.7 |
|
|
| 18.1 |
| 2.9 |
| 53.3 | |
The mineral reserves estimate reflects a bottom screen size of 1 mm.
Stockpiles are minor run-of-mine stockpiles that are maintained at or
near the process plant and are available to maintain blending of
kimberlite sources to the plant.
Table 2 - Mineral Resources at the Diavik Diamond Mine – December 31,
2014 (100% basis)
|
|
| Measured |
|
|
| Indicated |
|
|
| Inferred |
Pipe | | | Mineral Resource |
|
|
| Mineral Resource |
|
|
| Mineral Resource |
|
|
|
Mt
|
|
cpt
|
|
Mct
|
|
|
|
Mt
|
|
cpt
|
|
Mct
|
|
|
|
Mt
|
|
cpt
|
|
Mct
|
A154N
| | |
---
|
|
---
|
|
---
| | | |
---
|
|
---
|
|
---
| | | |
2.0
|
|
2.5
|
|
5.0
|
A154S
| | |
---
| |
---
| |
---
| | | |
---
| |
---
| |
---
| | | |
0.1
| |
3.8
| |
0.3
|
A418
| | |
---
| |
---
| |
---
| | | |
---
| |
---
| |
---
| | | |
0.3
| |
2.4
| |
0.7
|
A21
|
|
|
---
|
|
---
|
|
---
|
|
|
|
0.4
|
|
2.6
|
|
1.0
|
|
|
|
0.8
|
|
3.0
|
|
2.3
|
Totals |
|
|
---
|
|
---
|
|
---
|
|
|
| 0.4 |
| 2.6 |
| 1.0 |
|
|
| 3.1 |
| 2.6 |
| 8.3 |
The mineral resources estimate reflects a bottom screen size of 1 mm.
The mineral resources have reasonable potential to be mined but do not
have mining losses and/or dilution applied at this time, and as such
they represent in situ values. Mineral resources that are not mineral
reserves do not have demonstrated economic viability.
Further conversion of resources to reserves is expected in due course as
ongoing work plans progress. Specific and more immediate recommendations
include further work to define pipe shape ahead of mine development in
all four project pipes.
Updated Mine Plan for Diavik Diamond Mine
The following is a brief overview of the updated mine plan for the
Diavik Diamond Mine, including current estimates for anticipated annual
production by pipe, with associated operating and capital costs through
2023, and is based on the current reserves.
The Diavik Diamond Mine - Production
Table 3 below shows the planned mining tonnage at the Diavik Diamond
Mine for each ore body. The data is given on a calendar year basis,
beginning as of calendar 2015. These figures do not include rough
diamond stocks held at the mine at the opening of each year, nor does
the model take into account any rough diamond inventory available for
sale that the Company currently holds. Table 4 below shows the planned
carats recovered for each ore body.
Table 3 - Diavik Diamond Mine - Tonnes Processed (millions)
(100% basis)
Calendar Year |
|
|
| A154S |
|
|
| A154N |
|
|
| A418 |
|
|
| A21 |
|
|
| Total |
|
|
|
|
|
| |
2015 |
|
|
|
0.44
|
|
|
|
0.78
|
|
|
|
0.86
|
|
|
|
0.00
|
|
|
|
2.101 | | | | | | | |
2016 | | | |
0.44
| | | |
0.79
| | | |
0.87
| | | |
0.00
| | | |
2.10
| | | | | | | |
2017 | | | |
0.44
| | | |
0.80
| | | |
0.87
| | | |
0.00
| | | |
2.10
| | | | | | | |
2018 | | | |
0.35
| | | |
0.80
| | | |
0.80
| | | |
0.16
| | | |
2.10
| | | | | | | |
2019 | | | |
0.17
| | | |
0.81
| | | |
0.75
| | | |
0.37
| | | |
2.10
| | | | | | | |
2020 | | | |
0.00
| | | |
0.88
| | | |
0.75
| | | |
0.57
| | | |
2.20
| | | | | | | |
2021 | | | |
0.00
| | | |
0.90
| | | |
0.60
| | | |
0.80
| | | |
2.30
| | | | | | | |
2022 | | | |
0.00
| | | |
0.73
| | | |
0.05
| | | |
1.52
| | | |
2.30
| | | | | | | |
2023 |
|
|
|
0.00
|
|
|
|
0.57
|
|
|
|
0.00
|
|
|
|
0.24
|
|
|
|
0.81
| | | | | | | |
Total |
|
|
| 1.82 |
|
|
| 7.04 |
|
|
| 5.55 |
|
|
| 3.67 |
|
|
| 18.11 | | | | | | | |
Table 4 - Diavik Diamond Mine - Carats Recovered (millions)
(100% basis)
Calendar Year |
|
|
| A154S |
|
|
| A154N |
|
|
| A418 |
|
|
| A21 |
|
|
| Total |
|
| |
2015 |
|
|
|
1.63
|
|
|
|
1.61
|
|
|
|
3.58
|
|
|
|
0.00
|
|
|
|
6.891 | | | |
2016 | | | |
1.55
| | | |
1.56
| | | |
3.65
| | | |
0.00
| | | |
6.76
| | | |
2017 | | | |
1.58
| | | |
1.66
| | | |
3.62
| | | |
0.00
| | | |
6.86
| | | |
2018 | | | |
1.26
| | | |
1.81
| | | |
3.01
| | | |
0.48
| | | |
6.55
| | | |
2019 | | | |
0.72
| | | |
1.89
| | | |
2.58
| | | |
1.14
| | | |
6.32
| | | |
2020 | | | |
0.00
| | | |
2.17
| | | |
2.30
| | | |
1.93
| | | |
6.40
| | | |
2021 | | | |
0.00
| | | |
2.23
| | | |
1.51
| | | |
2.13
| | | |
5.86
| | | |
2022 | | | |
0.00
| | | |
1.80
| | | |
0.13
| | | |
3.82
| | | |
5.75
| | | |
2023 |
|
|
|
0.00
|
|
|
|
1.37
|
|
|
|
0.00
|
|
|
|
0.53
|
|
|
|
1.90
| | | |
Total |
|
|
| 6.74 |
|
|
| 16.09 |
|
|
| 20.37 |
|
|
| 10.02 |
|
|
| 53.29 | | | |
1The total ore processed and carats recovered for Calendar
2015 include 22,000 tonnes of stockpile material containing an estimated
68,000 carats.
In addition to the current reserves, there are 3.1 million tonnes of
inferred resource, of which 2.4 million tonnes (in the aggregate) are
distributed among the lower parts of each of A-154 South, A-418 and most
significantly, A-154 North. The operator of the Diavik Diamond Mine,
Diavik Diamond Mines (2012) Inc. (“DDMI”), currently expects to process
this material as part of its mining operations as they reach the lower
levels of each pipe. However, inferred mineral resources are considered
too geologically speculative to have the economic considerations applied
to them that would enable them to be categorized as mineral reserves,
and there is no certainty that they will be mined. They have therefore
not been included in the above mine plan. Mineral resources that are not
mineral reserves do not have demonstrated economic viability.
The Diavik processing plant has a potential capacity to process over 2
million tonnes a year. To supplement mined ore in calendar 2015, Diavik
plans to continue processing old coarse ore rejects material ("COR").
The grade of this material is variable but is generally high as shown by
the results from COR production from 2012, 2013 and 2014 contained in
Table 5. Based on these historical recovery rates, the tonnage of this
material which is planned to be processed during calendar 2015 would
have produced 0.29 million carats from COR. There is no plan to process
COR after calendar 2015.
Table 5: - Coarse Ore Rejects tonnes and carats - Diavik Diamond Mine
(100% Basis)
|
|
|
|
|
|
| |
COR Production |
| Tonnes 000's |
| Grade Cts per Tonne |
| Carats 000's | |
2012
|
|
5.3
|
|
26.1
|
|
139.0
| |
2013
|
|
14.4
|
|
26.9
|
|
388.0
| |
2014
|
|
8.2
|
|
27.0
|
|
220.8
| |
Capital and Operating costs
Table 6 shows the currently estimated sustaining and mine development
capital for the Diavik Diamond Mine from calendar 2015onward, in
millions of Canadian dollars. Table 6 also shows current estimated
operating costs, in millions of Canadian dollars, and is based on DDMI's
operating experience, adjusted to present-day dollar terms. Given the
remote location of the Diavik Diamond Mine, a large portion of the
operating expenditure is fixed, with the major cost items being human
resources and fuel (for both power and equipment).
Development capital at the Diavik Diamond Mine relates to the
development of the A-21 pipe. Expenditure on the development of the A-21
pipe in 2015 will relate to crushing costs, pipeline construction and
initial dike foundation and abutment work in preparation for expected
dike construction during the 2016 and 2017 summer seasons. Pit pre-strip
is expected to commence in 2018 following dewatering of the pool within
the dike. The total capital estimate includes an average contingency of
15 percent.
Table 6 -Diavik Diamond Mine - Capital and Operating Costs
(100% basis)
Calendar Year |
| Development Capital |
| Sustaining Capital |
| Total Capital |
| Operating Costs | |
2015 |
|
66
|
|
71
|
|
136
|
| 398 | |
2016 | |
116
| |
61
| |
177
| | 402 | |
2017 | |
131
| |
62
| |
193
| | 404 | |
2018 | |
79
| |
45
| |
124
| | 407 | |
2019 | |
0
| |
43
| |
43
| | 454 | |
2020 | | | |
32
| |
32
| | 431 | |
2021 | | | |
6
| |
6
| | 418 | |
2022 | | | |
2
| |
2
| | 356 | |
2023 |
|
|
|
0
|
|
0
|
| 280 | |
Total |
| 392 |
| 321 |
| 713 |
| 3,550 | |
Not shown in Table 6 are marketing costs, private royalties and
estimated reclamation costs. The Diavik Diamond Mine pays a Northwest
Territories royalty equal to the lesser of 13% of the value of the
'Output' of the mine or an amount calculated based on a sliding scale of
royalty rates dependent upon the value of 'Output' of the mine, ranging
from 5% for value of output between $10,000 and $5 million to 14% for
value of output over $45 million.
Under this mine plan Diavik will cease mining operation in 2023. The
reclamation costs are estimated at $165 million based on a DDMI closure
cost model that is considered to be equal to or better than others used
in the industry. The majority of these closure costs are expected to be
spent between 2024 and 2028 although the full reclamation plan will only
be completed in 2036.
Diamond Prices
Using the prices from the Company's January 2015 rough diamond sale and
the current diamond recovery profile of the Diavik processing plant, the
Company has modeled the approximate rough diamond price per carat for
each of the deposits listed in Table 7 below.
Table 7 - Modelled diamond prices by deposit
Diavik Ore Type
|
|
January 2015 Average Price per Carat
(in US dollars) | |
A-154 South
|
|
$135
| |
A-154 North
| |
$180
| |
A-418
| |
$95
| |
A-21
| |
$135
| |
COR
|
|
$45
| |
Forward-Looking Information
Information included herein that is not current or historical factual
information, including information about estimated mine life and other
plans regarding mining activities at the Diavik Diamond Mine, estimated
reserves and resources at, and production from, the Diavik Diamond Mine,
projected capital and operating costs, and future diamond prices,
constitute forward-looking information or statements within the meaning
of applicable securities laws. Forward-looking information can generally
be identified by the use of terms such as "may", "will", "should",
"could", "expect", "plan", "anticipate", "foresee", "appears",
"believe", "intend", "estimate", "predict", "potential", "continue",
"objective", "modeled", "hope", "forecast" or other similar expressions
concerning matters that are not historical facts. Forward-looking
information is based on certain factors and assumptions including, among
other things, mining, production, construction and exploration
activities at the Diavik Diamond Mine; mining methods; currency exchange
rates; estimates related to the capital expenditures required to bring
the A-21 pipe into production, required operating and capital costs;
labour and fuel costs; world and US economic conditions; future diamond
prices; and the level of worldwide diamond production. These assumptions
may prove to be incorrect. Forward-looking information is subject to
certain factors, including risks and uncertainties which could cause
actual results to differ materially from what the Company currently
expects. These factors include, among other things, the uncertain nature
of mining activities, including risks associated with underground
construction and mining operations, risks associated with joint venture
operations, risks associated with the remote location of and harsh
climate at the Diavik Diamond Mine, risks resulting from the Eurozone
financial crisis, risks associated with regulatory requirements, the
risk of fluctuations in diamond prices and changes in US and world
economic conditions, the risk of fluctuations in the Canadian/US dollar
exchange rate and cash flow and liquidity risks. Actual results may vary
from the forward-looking information. Readers are cautioned not to place
undue importance on forward-looking information, which speaks only as of
the date of this disclosure, and should not rely upon this information
as of any other date. Due to assumptions, risks and uncertainties,
including the assumptions, risks and uncertainties identified above and
elsewhere in this disclosure, actual events may differ materially from
current expectations. The Company uses forward-looking statements
because it believes such statements provide useful information with
respect to the currently expected future operations and financial
performance of the Company, and cautions readers that the information
may not be appropriate for other purposes. While the Company may elect
to, it is under no obligation and does not undertake to, update or
revise any forward-looking information, whether as a result of new
information, future events or otherwise at any particular time, except
as required by law. Additional information concerning factors that may
cause actual results to materially differ from those in such
forward-looking statements is contained in the Company's filings with
Canadian and United States securities regulatory authorities and can be
found at www.sedar.com
and www.sec.gov,
respectively.
Qualified person
The scientific and technical information contained in this press release
has been prepared by Diavik Diamond Mines (2012) Inc., operator of the
Diavik Diamond Mine, under the supervision of Calvin Yip, P. Eng.,
Principal Advisor, Strategic Planning of Diavik Diamond Mines (2012)
Inc., and a Qualified Person within the meaning of National Instrument
43-101 of the Canadian Securities Administrators.
About Dominion Diamond Corporation
Dominion Diamond Corporation is a Canadian diamond mining company with
ownership interests in two major producing diamond mines. Both mines are
located in the low political risk environment of the Northwest
Territories in Canada.
The Company operates the Ekati Diamond Mine through its 88.9% ownership
as well as a 65.3% ownership in the surrounding areas
containing additional resources, and also owns 40% of the Diavik Diamond
Mine. It supplies rough diamonds to the global market through its
sorting and selling operations in Canada, Belgium and India and is the
world’s third largest producer of rough diamonds by value.
For more information, please visit www.ddcorp.ca
Contacts:
Dominion Diamond Corporation
Mr. Richard Chetwode, +44 (0)
7720-970-762
Vice President, Corporate Development
rchetwode@ddcorp.ca
or
Ms.
Kelley Stamm, 416-205-4380
Manager, Investor Relations
kstamm@ddcorp.ca
Source: Dominion Diamond Corporation
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