Lucapa Diamond Company Unleashes Stellar Q2 2017 Performance at Lulo Diamond Project, Angola
Lucapa Diamond Company Limited, a prominent player in the global diamond industry, has announced an exceptionally strong performance from its Lulo Diamond Project in Angola for the second quarter of 2017. The period witnessed a significant surge in diamond production, solidifying Lulo’s reputation as a world-class producer of large, high-value alluvial diamonds. These impressive results underscore the operational efficiency and strategic focus of Lucapa and its partners, driving considerable value in the luxury gemstone market.
During the June Quarter (Q2 2017), the Lulo Diamond Project achieved a remarkable diamond production of 4,203 carats. This figure represents a substantial year-on-year increase of 63%, highlighting a period of accelerated growth and enhanced productivity. Such a robust performance in a single quarter is a testament to the effective mining strategies and dedicated efforts deployed on-site, positioning Lucapa as a leading force in Angolan diamond mining.
The stellar Q2 output significantly boosted the first-half (H1 2017) production totals, bringing the cumulative yield to 8,301 carats. This H1 performance marks a considerable 46% increase when compared to the 5,668 carats produced in the first half of 2016. These consistent and escalating production figures demonstrate a clear upward trajectory for the Lulo project, reinforcing investor confidence and strengthening Lucapa’s market presence in the high-value diamond sector.
Lulo’s Signature: The Recovery of Exceptional ‘Special Diamonds’
The Lulo Diamond Project is renowned globally for its consistent recovery of large and exceptionally valuable diamonds, often referred to as “Special diamonds.” The second quarter of 2017 further cemented this reputation, with a remarkable increase in the number and total weight of these premium stones. The company proudly reported a 97% surge in the recovery of Special diamonds, bringing the total count to 57 during the quarter. This exceptional recovery rate is a key indicator of the high-grade nature of the Lulo concession.
Beyond the sheer number, the cumulative weight of these Special diamonds also saw a significant boost, rising by 76% to an impressive 1,199 carats for the quarter. This figure is particularly significant as it directly translates to higher revenue potential, given the disproportionately higher value commanded by larger, rarer diamonds in the market. The recovery of such a substantial weight of premium stones within a three-month period further solidifies Lulo’s unique position in supplying the global luxury diamond trade with exquisite gems.
Among the standout recoveries during the quarter were two extraordinary diamonds, each exceeding 50 carats. These monumental finds are not only intrinsically valuable but also serve as powerful showcases for the unparalleled quality and size of diamonds consistently unearthed at Lulo. Such discoveries attract significant attention from high-end diamantaires and collectors worldwide, underscoring the project’s capacity to deliver truly exceptional natural treasures.
Boosting Operational Efficiency: Record Mining Volumes and Strategic Targets
The impressive diamond recovery figures are a direct result of enhanced mining volumes and operational efficiencies at the Lulo site. The second quarter witnessed a significant 55% increase in mining volumes, reaching 57,283 bank cubic metres (bcm). This substantial ramp-up in excavation activity is a critical factor in accessing more diamondiferous material and subsequently increasing the yield of precious stones.
Lucapa Diamond Company emphasized that this accelerated pace of mining has placed the Lulo project firmly on track to achieve its ambitious annual volume targets. The company is confidently progressing towards a projected record 240,000 bcm for the entire 2017 fiscal year. Achieving this target would not only demonstrate robust operational execution but also set a new benchmark for productivity at the project, laying a strong foundation for future growth and consistent diamond supply.
The ability to increase mining volumes so significantly while maintaining high recovery rates speaks volumes about the expertise and advanced techniques employed at Lulo. This commitment to efficiency and meeting strategic objectives is crucial for maximizing the economic potential of the alluvial diamond deposits, ensuring long-term profitability and sustainable operations within Angola’s vital mining sector.
Diamond Grade and Size Consistency: Pillars of Lulo’s Quality
Beyond the impressive volumes, the quality metrics of the recovered diamonds also showed encouraging improvements. The average grade of diamonds recovered during the quarter improved by 5%, reaching an impressive 7.3 carats per 100 cubic metres. This upward trend in grade signifies that the mining operations are increasingly targeting or accessing richer diamond-bearing gravels, which directly enhances the overall economic viability and profitability of the Lulo project.
Furthermore, the average size of the diamonds recovered remained steady at a respectable 1.3 carats. This consistency is highly valued in the diamond market, particularly given Lulo’s reputation for producing larger stones. Maintaining a stable average size while increasing the overall grade ensures that the project continues to deliver high-quality, commercially desirable diamonds consistently, reinforcing its premium market position. This balance of grade and size underscores the intrinsic value of the Lulo concession.
Financial Health: Robust Inventory and Strong Sales Performance
Sociedade Mineira Do Lulo (SML), the operator of the Lulo alluvial mine and a joint venture partner, reported a healthy diamond inventory of 1,716 carats on hand as of June 30, 2017. This inventory level represents a significant 37% increase compared to previous periods, indicating strong ongoing production that outpaced immediate sales during the reporting period, a positive sign for future revenue streams.
Despite building inventory, the company also reported robust sales performance. During Q2 2017, sales generated US$ 4.8 million. For the entire first half of the year, total sales reached an impressive US$ 15.4 million. These figures demonstrate strong market demand for Lulo diamonds and reflect effective sales strategies by Lucapa and SML, converting high-value production into significant financial returns for shareholders and stakeholders.
Strategic Mining Blocks: Targeting High-Value Deposits
Lucapa’s mining operations are highly strategic, focusing on specific blocks known for their rich diamond content. In April and May 2017, the mining efforts were concentrated on Mining Block 28. This block, as highlighted by the recovery of a magnificent 60-carat D-Colour diamond during the quarter (as featured in the accompanying image), proved to be highly productive, yielding significant large and valuable stones.
Following this period, operations in June 2017 shifted back to the historically higher-value Mining Blocks 8 and 6. This strategic rotation allows Lucapa to optimize recovery from different areas of the concession, leveraging geological understanding to maximize the extraction of premium diamonds. Such targeted mining ensures that resources are deployed most effectively, continually enhancing the overall profitability and yield of the Lulo project.
Unlocking the Future: Accelerating Kimberlite Exploration at Lulo
While the Lulo project is celebrated for its alluvial diamond production, Lucapa Diamond Company maintains a strong focus on discovering the primary source or sources of these exceptional diamonds. To this end, the company is actively engaged in a comprehensive kimberlite exploration program, crucial for understanding the long-term potential of the Lulo concession beyond its existing alluvial deposits.
Lucapa announced that it would soon provide an eagerly anticipated update to shareholders regarding the results and interpretation of a helicopter-borne Time Domain Electromagnetic (“TDEM”) survey. This advanced geophysical survey was conducted over the extensive Cacuilo Valley area at Lulo, a region identified as having high prospectivity for diamondiferous kimberlite pipes. The finalization and interpretation of this data represent a critical step in the ongoing exploration efforts.
The insights garnered from the TDEM survey results are expected to significantly guide and enhance the Lulo kimberlite drilling program. The ultimate objective of this intensive drilling campaign is to precisely locate the elusive primary source or sources of the extraordinary alluvial diamonds that have consistently been recovered within the Lulo concession. Finding these kimberlite pipes would unlock an entirely new dimension of potential for the project, promising a future of hard-rock diamond mining alongside the current alluvial operations.
Further bolstering these exploration efforts, the drilling program will also benefit immensely from the detailed laboratory analysis of kimberlite core samples. These analyses, conducted in specialized facilities in South Africa, provide invaluable geological and mineralogical data. Such scientific rigor is essential for accurately identifying and characterizing diamondiferous kimberlites, accelerating the path towards potentially discovering a world-class primary diamond deposit at Lulo.
The proactive and systematic approach to kimberlite exploration demonstrates Lucapa Diamond Company’s commitment to unlocking the full geological potential of the Lulo concession. Success in this endeavor would not only transform the project but also significantly enhance shareholder value and secure a long-term future for diamond production in this mineral-rich region of Angola, reinforcing its importance in the global diamond supply chain.
Pic Cap: A magnificent 60-carat D-Colour diamond, a testament to Lulo’s exceptional yield, recovered from Mining Block 28 during the Quarter.
News Source: gjepc.org