Firestone Diamonds delays Lesotho mine launch
Africa-focused Firestone Diamonds (LON:FDI) warned Tuesday that the schedule at its Liqhobong diamond mine in Lesotho has slipped back from the end of the first half of next year to the fourth quarter of 2016.
Adverse weather conditions and the need to shift more earth than had previously been anticipated have added about US$13 million to costs.
However, the company noted the project remains well within the original $185.4 million budget and that it will fully funded through to production ramp up.
“A number of initiatives have been implemented to reduce any resulting delay to the overall programme, including the introduction of an additional shift, additional work crews and redeployment of contractors to areas that are on the critical path from areas which are ahead of schedule,” the miner said in a statement.
Further, Firestone sought to delay the delivery of constructed steel and delay other work streams to allow the earthworks to catch up, while, at the same time, reducing the cash drawdown requirements and associated financing charges.
Securing power sources
Firestone also said it has signed an agreement with Storm Mountain Diamonds, the owner of the Kao mine, in Lesotho, to use the power line alongside the company and to contribute a bit over $7.7 million of the revised project costs to connect the mines to the national electricity grid.
“This is an important milestone for the company, as it will allow Liqhobong to use grid power on site during construction earlier than planned, thus reducing the diesel generating costs and realising a small saving,” it noted
Firestone has a 75% stake in the Liqhobong mine, while the African nation’s government owns the remaining 25%.