Ghaghoo mine scales down production

Gaghoo mine, a local mine owned by Gem Diamonds will this year reduce its production plan to approximately 300 000 tonnes.

Output from the company’s Ghaghoo mine dropped five percent to 11, 029 carats after the miner said in February it considered it prudent to scale back the operation as average selling prices fell. In its first quarter trading update Gem Diamonds Chief Executive, Clifford Elphick said production slowdown and cost reduction plan is implemented with the downsizing of the operation advanced. “At Ghaghoo the downsizing of the operation is advanced and the buffer zone around the sand ingress has been successfully created.

Development of the second production block on Level 1 has progressed well and will be the main source of ore for the remainder of the year,” he said. A parcel of 14 114 carats of Ghaghoo diamonds was sold during the period for an average of US$ 160 per carat, which is seven percent above the previous price achieved in December 2015.

Elphick said although Ghaghoo will operate at a reduced production rate during 2016, prices for the Ghaghoo production will continue to be monitored and the option of returning to full production regularly reviewed. The Ghaghoo operation recovered 11 029 carats achieving a recovered grade of 21.8cpht. The majority of the 50 514 tonnes of ore treated was sourced from tunnels one to five on Level 1.

The area of the pipe mined was close to the contact and contained more internal dilution and hence delivered a lower grade when compared to the previous quarter.  The development of the second production block is progressing well with over 200 metres of tunnelling completed per month, which will allow access to higher grade ore towards the centre of the pipe from mid year onwards.