Africa-focused miner Gem Diamonds (LSE: GEMD) announced on Tuesday a revised life-of-mine plan for its prolific Letšeng operation in Lesotho, alongside a two-year extension to the company’s revolving credit facilities.
Gem Diamonds’ new strategy aims to enhance operational efficiency and reduce costs significantly. It includes approval of a design change, with steeper slopes for the final open-pit cutback of the satellite pit. The ore to waste stripping ratio for Satellite Cut 6 West (SC6W) has been reduced from 1:6.9 to 1:2.1.
The adjustment will decrease the total waste stripping by 65.8 million tonnes, Gem Diamonds said, leading to an estimated cost saving of US$180 million in future waste-stripping expenses.
To support the steeper slopes, the company will implement various safety measures, including strategically placed catchment fences, rockfall barriers, wire-mesh draping, improved blasting techniques, and mechanical scaling. These measures are designed to mitigate potential rockfall risks and ensure the stability of the mining operations.
While the revised waste slope design has reduced the accessible ore by 2.4 million tonnes, there is potential to access additional ore by steepening the kimberlite slopes. This opportunity is currently under assessment and could further optimize resource extraction.
Financial stability
Gem Diamonds also said on Tuesday it had extended its revolving credit facilities of US$71.7 million by two years. They are now set to expire on Dec. 21, 2026, which provides it with additional financial flexibility to support its operations and strategic initiatives.
The Letšeng mine, in which Gem Diamonds has a 70% interest, is one of the world’s 10 largest diamond operations by revenue. At 3,100 metres (10,000 feet) above sea level, it is also one of the world’s highest-altitude diamond mines.
The operation has a track record of producing large, exceptional white diamonds, which makes it the highest-dollar-per-carat kimberlite diamond mine in the world.
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