Lucara approves $514M Karowe mine expansion

Lucara Diamond (TSX: LUC) has announced that its board has formally accepted a planned underground expansion of the Karowe mine in Botswana, which is expected to extend the operation’s life for 20 years — until 2040. 

The Vancouver-based miner said the approval follows the financial closure and satisfaction of all conditions precedent to a US$220 million debt package, announced in July.  

Lucara said the first US$170 million would be available in mid-September, adding that total costs will be largely covered via a combination of loans, cash resources and equity financing. 

Moving Karowe underground will allow Lucara to exploit the highest value part of the orebody first, generating over US$5.25 billion in gross revenue, president and CEO Eira Thomas has said. 

The company noted that construction efforts had ramped up since the facilities’ documentation was executed in mid-July. 

The pre-sinking of ventilation is underway and a total of four blasts have occurred to date with continued drilling, mucking, and installation of ground support on a 24-hour basis. 

The company is mobilizing the remaining pre-sinking equipment and contractors. 

Lucara says Karowe remains one of the highest-margin diamond mines in the world, producing an average of 300,000 high-value carats each year.  

The mine, which began commercial operations in 2012, has already become the only one in recorded history to have yielded two 1,000+ carat diamonds — the 1,758 carat Sewelô in 2019 and the 1,109 carat Lesedi La Rona in 2015, which sold for US$53 million.