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AFRIcA DoWn UnDeR PReVIeW

Aussie addition Wetherall admires the 213ct rough white
Lucapa managing director Stephen
D-colour diamond recovered from the
only elevates company’s Mothae mine in Lesotho. In May,
Lucapa unveiled the 213ct stone, as well as
a 15ct polished heart shaped pink gem from
its Lulo mine in Angola (inset) at the recently
African base reopened West Australian Museum

he addition of an Australian flavour to cord of building mines – Lulo was thought Performance at both operations was in
Tits portfolio will enhance, rather than to be too hard and Mothae had four own- line with guidance which Lucapa issued
detract from Lucapa Diamond Company ers who did nothing with it – and produc- for the first time this year.
Ltd’s African diamond assets, according ing cashflow,” Wetherall said. Wetherall said the decision to issue
to its managing director. The company’s June quarterly report production guidance was also part of the
Lucapa acquired the Merlin diamond highlighted just how lucrative both Lulo company’s marketing to larger institu-
project in the Northern Territory in May, and Mothae are becoming. The compa- tional investors.
placing it on the cusp of a new era of dia- ny posted first-half attributable revenue “They see value well beyond 5c [the
mond mining for Australia, but managing of $35.1 million from Lulo (Angola) and current share price],” he said. “They have
director Stephen Wetherall is convinced Mothae (Lesotho) having processed re- been impressed by our track record and
the new project will also help raise the cord volumes at both mines during the the cash flow we produced and encour-
profile of existing assets. June quarter. aged us to put out our maiden guidance
“For some time, we have been trying Given the challenges of COVID, weath- to cement that.”
to get new eyes on the stock and that’s er and a delay to expansion optimisation, The performance at Mothae will have
what this acquisition has done,” Wether- Wetherall said the company’s half-year been particularly pleasing for manage-
all told Paydirt. performance had been “very solid”. ment given the mine was put on hold last
Many of those new eyes came via a At the Lulo alluvial operation in Angola, year.
$21.7 million placement and SPP to fund processed material rates were up 124% Chief operating officer Nick Selby said
the $8.5 million acquisition of Merlin. in the June quarter compared to the the ramp-up had gone well.
Wetherall said the company had been previous year with carats recovered up “The recommissioning is up and run-
encouraged by the response of existing 123% to 6,551ct. ning although we are still busy balanc-
larger shareholders and institutional in- While grade fell during the June quar- ing the plant but we have it under con-
vestors to the capital raising. ter, as it did in the March quarter, Lulo trol,” he said. “It has been a strong first
“We have had a very good reception continued to generate greater revenue five months. There are days when we
from existing institutional investors and it thanks to the coarse and high-value run over and there are days when we
has put us in front of many new ones,” he nature of the diamonds recovered from don’t. We are not there yet. The extreme
said. “While there’ll be some dilution, we gravels in mining block MB46. Some weather has proven a challenge [Mothae
believe it will be countered by share price 204 plus-4.8ct and 79 plus-10.8ct stones posted a daily high of -9ºC in May] but
appreciation in the coming months.” were recovered during the quarter in- that is all part of managing operations.”
While Merlin fills Lucapa’s develop- cluding a 144ct D-colour Type IIa, the At Lulo, the company and its JV part-
ment pipeline, its existing operations are fifth largest diamond ever found at Lulo. ners (state diamond miner Endiama and
providing the cash flow to fund its devel- At Mothae, the focus is on completing local company Rosas & Petalas) have
opment. Merlin comes with a reputation a 45% capacity expansion project, bring- avoided any COVID catastrophe thanks
of being a difficult asset but, according ing processing throughput rates to 215 to what Selby described as “serious pro-
to Wetherall, new investors had been im- tph. Despite the ongoing expansion, the tocols in place”.
pressed by Lucapa’s ability to turn simi- operation still achieved record quarterly Lulo has developed an international
larly “troubled” operations at Lulo and processing rates with 317,658t milled reputation for producing large, high-val-
Mothae into profitable concerns. during the June period, up from 185,497t ue diamonds. Wetherall said the latest
“They were impressed by our track re- in the March quarter. Lulo sale – which saw seven diamonds

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