Mountain Province banks first diamond sales from Gahcho Kué

VANCOUVER (miningweekly.com) – Mountain Province Diamonds, which partly owns the Gahcho Kué mine in Canada's Northwest Territories, has completed the mine’s first diamond sale.

A total of 49 420 ct were sold for about $6.27-million, representing an average price of about $127/ct.

Mountain Province said in a statement on Thursday that about 75% of the parcels offered on the first diamond sale held between January 16 and 25, in Antwerp, Belgium, were sold. The balance, which represent smaller, mainly brown and lower-quality diamonds, were withdrawn after it failed to receive acceptable bids.

The company stated that demand had declined for smaller, lower-quality diamonds, largely owing to liquidity restrictions caused by demonetisation in India.

Mountain Province cautioned that the diamonds sold should not be taken as representative of the longer-term realised diamond price profile.

"Our first diamond sale was well attended with 96 companies bidding for individual parcels. The introduction to the market of first production from a new mine is a price discovery exercise with buyers naturally cautious. As our production volumes increase and the market becomes more familiar with our diamonds, we expect interest to grow. The level of demand for our smaller, lower-quality diamonds was disappointing, but we expect improvements as Indian liquidity issues abate,” president and CEO Patrick Evans commented.

The company's next sale is scheduled to start on February 20, and will take place once every five weeks thereafter.

MINE RAMP-UP
Mountain Province reported that the ramp-up of production at Gahcho Kué that started ahead of schedule on August 1, saw 515 000 t of kimberlite being processed to December 31, recovering 862 000 ct for an average grade of 1.67 ct/t. During the fourth quarter the plant processed about 412 000 t of ore and produced 697 000 ct on a 100% basis, of which the company's 49% share is about 341 000 ct.

"Commissioning ramp-up from August to early December went smoothly. Extremely cold conditions during December impacted the mine's conveyor systems, but the mining and processing progressed satisfactorily. Winterisation measures to address the conveyor issues are well under way with commercial production now expected to be achieved by the end of the current quarter,” Evans said.

The total mining of waste and ore from the 5034 openpit for the twelve months to December 31, was about 22.5-million tonnes, with about 70 000 t of ore stockpiled at year-end.

The Gahcho Kué Joint Venture, a collaboration between De Beers Canada (51%) and Mountain Province Diamonds (49%). De Beers follows an entirely separate process through its global sales division for selling its portion of the diamonds and does not publicly report sales or prices by operation.