REG - BlueRock DiamondsPLC - Q2 2022 Production Update

Bluerock DiamondsAnnouncement

11/07/2022 16:00

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RNS Number : 0679S  BlueRock Diamonds PLC  11 July 2022

BlueRock Diamonds PLC / AIM: BRD / Sector: Natural Resources

11 July 2022

BlueRock Diamonds PLC ('BlueRock' or the 'Company')

Q2 2022 Production Update

 

BlueRock Diamonds PLC, the AIM listed diamond producer, which owns and
operates the Kareevlei Diamond Mine ('Kareevlei') in the Kimberley region of
South Africa, announces its Q2 2022 production update along with details of
changes both to management and production guidance for the year ending 31
December 2022.

 

Overview

 

                           Q2 2022  Q2 2021  % Variation
 Tonnes Produced           139,531  134,510  +4%
 Grade cpht                2.6      4.0      -37%
 Carats produced           3,570    5,442    -34%
 Carats sold               2,699    5,106    -47%
 Avg. price per carat USD  575.66   427.78   +35%

 

BlueRock Executive Chairman, Mike Houston, said, "The extreme weather
conditions, which saw 145mm of rain fall during the Q2 period compared to 9mm
of rain for the corresponding period in 2021, are reflected in what is a
disappointing quarter with production significantly less than  budget.
 During the period, the Company had limited access to fresh kimberlite
resulting in the feed to the plant being a lower grade plus having a higher
percent of fines/ clay material, which are more susceptible to wet conditions
and impacted negatively on throughput tonnage. As previously reported, we have
benefitted from improved weather over the past month and a better-balanced
drier material has been supplied to the processing plant, taking us one step
further towards achieving our stated objective of increasing production to 1
million tonnes per annum.

 

"The market has remained buoyant for non-Russian rough diamonds in the period
under review and Kareevlei has averaged $576 a carat in the quarter, 35% up on
the $428 a carat achieved during the same period last year.  With the ongoing
tightness of supply of rough diamonds and the expected recovery of the Chinese
retail market, the outlook for the rest of the year for rough diamond prices
is positive.

 

"With additional financing secured, we will continue to focus our efforts on
optimising our mining operations at Kareevlei to benefit fully from the
potential of the new plant and take advantage of what is a strong market, and
I look forward to providing further updates throughout the year as the
positive trajectory that we have seen in recent weeks hopefully continues
throughout Q3 and into Q4."

 

Management Changes at Kareevlei

As recently announced, BlueRock's major shareholder, Teichmann Group, will
take a more direct role in the management of the Company and the Kareevlei
operations; accordingly, immediate steps have been taken by Teichmann Group at
Kareevlei level.

 

An experienced, high level technical and commercial team (ex-De Beers) has
completed a full review of the operations and although the detailed report is
expected shortly, a number of positive proposals have already been made, which
when implemented should enhance operational performance.

 

The current Kareevlei CEO, Meiring Burger, will step down on 31 July 2022 with
Gary Teichmann, a non-executive director of BlueRock, expected to take on an
Interim CEO role at Kareevlei from this time.  Two experienced individuals
covering the mining and processing disciplines have been secured to work in
conjunction with Gary Teichmann at Kareevlei over the next six months to
implement recommended changes whilst the Group searches for a new CEO at
Kareevlei.

 

Large stones recovered in 2022

 Date sold 2022  Carats  Value    Value per carat USD000

                         USD000
 March           19.3    116      6
                 12.7    128      10
                 8.7     104      12
                 6.6     63       9.5
 February        11.9    211      17.6
                 8.3     96       8.3
                 13.6    78       5.8
                 7.5     75       10
 January         6.8     63       9.3

Note: It is Company policy to announce all stones sold with a value of in
excess of USD50k.

 

Outlook

While guidance for 2023 remains unchanged, the Company's revised guidance for
2022 is as follows:

 

                            Revised Outlook:  Previous Outlook: 2022  % Change:  Outlook:

                            2022                                      2022       2023
  Tonnes processed ('000)   700-750           780 - 830               -c10%      1,000
  Carats produced           24,500-30,000     28,000 - 33,000         -c10%      43,000
  Grade                     3.60 - 4.00       3.60 - 4.00             0%         4.3
  Value Per Carat (USD)     500 - 550         500 - 550               0%          450
 Revenue (USDm)             12 - 16.5         14 - 18                 -c10%      19

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 as it forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this
announcement via Regulatory Information Service ('RIS'), this inside
information is now considered to be in the public domain.

 

**ENDS**

 

For further information, please visit BlueRock's
website www.bluerockdiamonds.co.uk (http://www.bluerockdiamonds.co.uk/)  or
contact:

 

 BlueRock Diamonds PLC

 Mike Houston                           m.houston@bluerockdiamonds.co.uk

 David Facey, FD                        dfacey@bluerockdiamonds.co.uk
 SP Angel (NOMAD and Broker)

 Stuart Gledhill / Caroline Rowe        Tel: +44 (0)20 3470 0470
 St Brides Partners Ltd (Financial PR)

 Isabel de Salis / Charlotte Page       bluerock@stbridespartners.co.uk

 

Notes to editors:

BlueRock Diamonds is an AIM-listed diamond producer which operates the
Kareevlei Diamond Mine near Kimberley in South Africa which produces diamonds
of exceptional quality and ranks in the top ten in the world in terms of
average value per carat. The Kareevlei licence area covers 3,000 hectares and
hosts five known diamondiferous kimberlite pipes with a combined inferred
resource of 10.4 million tonnes / 516,200 carats (February 2021); based on its
planned production of 1 million tonnes per annum, this provides a minimum
10-year life of mine.

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