Canada-headquartered Lucara Diamond Corp said on Monday that the strong price recovery of the fourth quarter has continued into 2021, and a stable, positive price environment was forecast for the year.
Following an incredibly challenging year in 2020, the diamond industry began 2021 with a healthier supply-demand balance than it had had at any stage in the past five years, the miner, which operates in Botswana, said.
Lucara posted fourth-quarter revenue of $42.4-million, up from $41.3-million in the third quarter, but down from $56-million on the prior-year quarter. The miner obtained an average price of $402/ct in the fourth quarter, compared with $365/ct in the third quarter. In the previous-year fourth quarter, the average price was $568/t.
For the full-year, Lucara posted revenue of $125.3-million, compared with $192.5-million, and achieved an average price of $335/ct, compared with $468/ct.
The miner reported a net loss of $26.3-million for the year.
“The measures that Lucara took early in the pandemic, including the decision not to sell rough diamonds in excess of +10.8 ct after the first quarter, helped protect and support prices for large, high value diamonds that account for more than 70% of our revenues.
“These efforts in conjunction with our transformational supply agreement with HB Antwerp executed in July, resulted in strong price recoveries by fourth quarter, a trend which has continued into 2021,” said CEO Eira Thomas.
Reporting on progress at the Karowe mine extension project, in Botswana, she said that Botswana had granted Lucara a mining licence extension for 25 years.
“This is a critical milestone for the underground project, paving the way for the completion of a supplementary debt financing in support of full project sanction, anticipated in the second half of 2021.”
The underground expansion programme has an estimated capital cost of $514-million and a five-year period of development.