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January 2016
MODERN MINING
5
MINING News
BlueRock Diamonds, listed on London’s
AIM, has issued an update on its Kareevlei
diamond project, located approximately
100 km north west of Kimberley in the
Northern Cape
The company says it is now operating
two shifts a day at the Kareevlei treatment
plant. “Production levels remain below
capacity as we continue to bed in the plant
and deal with the challenges that arise
from operating at far higher levels than
hitherto and from the increased demands
placed on the infrastructure from the com-
mencement of operations by Diacar; in
particular, water supply which has been
exacerbated by the particularly dry sum-
mer,” states the company. “Accordingly, we
processed approximately 9 000 tonnes of
mined kimberlite in November 2015. We
expect that plant throughput will increase
over the next two or three months as we
continue with the bedding-in process.
“Our subcontractor, Diacar, has com-
Avenira further de-risks
Baobab phosphate project
Australia’s Avenira Limited – previously Mine
makers – reports that the Baobab phosphate
project in Senegal has been further de-risked
with the release of a maiden indicated mineral
resource estimate. The decision to commence
mining was made in mid-November which
allowed long lead time items to be ordered
and water drilling to commence.
The indicated mineral resource estimate
has been completed for much of the eastern
half of the Small Mine Permit at Gadde Bissik
East, and represents the first phase of the
resource status upgrade planned to advance
the project to mining status.
The Baobab project area covers a total area
of approximately 1 553 km
2
. Within the area,
the Gadde Bissik prospect of approximately
90 km
2
was identified during excavation of
water wells in the 1950s. Avenira has man-
aged the exploration of the Gadde Bissik area
since early 2014, building up a comprehen-
sive knowledge of the Baobab project and
its potential.
In a statement released in December,
Kumba Iron Ore says that the deteriorat-
ing price environment has necessitated
a further optimisation of the Sishen mine
plan that was set out at the Group’s interim
results on 21 July 2015.
Kumba has decided to reconfigure the
Sishen pit to a lower cost shell configura-
tion in order to optimise margins. This is
in line with its strategy to focus on value
(cash generation) over volume, thereby
safeguarding the mine’s viability at lower
prices.
“Our industry is under tremendous
pressure with the market now pricing in
a more muted trend for the iron ore price
over the medium to longer term. This is
driven mainly by the expectation that sup-
ply growth will remain strong, against the
backdrop of an ever more cautious outlook
on China’s economic growth trajectory.
These circumstances have reinforced the
need to make tough decisions for our
business that will enable it to withstand a
longer period of much lower prices,” said
CEO Norman Mbazima.
The newpit shell configurationwill allow
for a more flexible approach, reduce execu-
tion risk and lower capital cost over the life
Kumba to reconfigure Sishen pit
Heavy mining equipment lined up at Sishen. Kumba reports that it is adopting a new pit shell configura-
tion that will allow for a more flexible approach, reduce execution risk and lower capital cost over the life
of mine (photo: Kumba Iron Ore).
of mine. The mine will target FOB unit costs
of approximately US$30/t and a breakeven
price of US$40/t CFR for 2016. Waste move-
ment is expected to be materially below
previous guidance of approximately 230Mt
at 135 Mt and production is expected
to be reduced from previous guidance
of 36 Mt for 2016 to roughly 26 Mt.
In respect of its Kolomela mine, Kumba
says this has been transitioned from three
pits to two in the short to medium term
in order to save costs. The mine is target-
ing a 2016 FOB unit cost of approximately
US$27/t and a breakeven price of US$38/t
CFR for 2016. The production target
remains at 13 Mt by 2017.
menced operations and processed
approximately 5 000 tonnes in November
2015. Diacar is continuing with the
planned improvements to its plant and
it is expected that production levels will
increase towards expected levels during
Q1 2016.”
BlueRock says the quality of its stones
remains high and that it is seeing an
increase in the coarseness and quality of its
output.“As a result, despite the weak prices
at the lower end of the diamond market,
our average prices remain higher than
estimated in the CPR; our output since
production recommenced after the recent
upgrade was sold at an average price of
US$273 compared to the US$232 per carat
indicated in our CPR.
“We remain comfortable that the
grade estimated in the CPR of 5,5 cpht is
supported by results to date and we will
provide further detail in this regard towards
the end of the first quarter of 2016.”
Diacar starts operations at Kareevlei