Dominion Diamond Corp Issues Updated Calendar 2013 Production, and Fiscal 2014 Sales, Guidance


Dominion Diamond Corporation (DDC.TO, DDC) announced today that the revised forecast for calendar 2013 for the Diavik Diamond Mine currently foresees production (on a 100% basis) of approximately 6.6 million carats from the mining of approximately 1.6 million tonnes of ore and the processing of approximately 2.0 million tonnes of material from both mining and stockpiles. The approximately 11% increase in carats produced for calendar 2013, as compared to the previously disclosed plan, relates primarily to the processing of more stockpiled ore during the calendar year. This plan is subject to further revision at the end of the second quarter.

A new mine plan and budget for the Ekati Diamond Mine for the next operating period is currently under review. This plan foresees production (on a 100% basis) for the period from April 10, 2013 (the date of acquisition by the Company of its interest in the Ekati Diamond Mine) to the calendar 2013 year-end of approximately 1.0 million carats from the mining of approximately 3.5 million tonnes from mineral reserve, and the processing of approximately 3.9 million tonnes, with the additional material being made up of diamond bearing kimberlite from a satellite body in the Misery open pit that is excavated as part of the waste stripping as the pit profile is advanced.

Rough diamond sales for fiscal 2014, based on current rough diamond prices, are expected to be a total of approximately $730 million with $365 million coming from each of the 40% share of Diavik and the 80% share of Ekati. Included in the fiscal 2014 sales for the Diavik Diamond Mine is approximately $25 million from sales of goods available for sale at January 31, 2013 and for the Ekati Diamond Mine is approximately $70 million from opening acquisition inventory that is expected to be sold towards the end of fiscal 2014.

The model that had been included with the reserves and resource statement that was issued on April 24, 2013 assumed, as revenue for the period from January 1, 2013 to June 30, 2013, of approximately $135 million from the sale of all inventory on hand during that period. This model was prepared to justify the classification of reserves at the Ekati Diamond Mine by demonstrating economic value under the reporting rules of National Instrument 43-101 and does not constitute the operating plan for the project. This inventory is not expected to be sold prior to June 30, 2013. The company's technical report in respect of the Ekati property is expected to be filed during the current month.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

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