Lucara underground Karowe diamond mine cost jumps 25% to US$683M

Lucara Diamond (TSX: LUC) provided an update on the Karowe underground diamond mine expansion that puts the total preproduction cost at US$683 million, up 25% from the earlier estimate of US$547 million. Underground production will be delayed to the first half of 2028, rather than the second half of 2026 when it was originally scheduled.

Nonetheless, the company insists the project remains technically and economically feasible. The revenue profile will be adjusted to reflect the processing of lower-grade stockpiles when the open pit ore is exhausted in 2026 and before the underground mine begins production. Milling will continue at the current rate of approximately 7,200 t/d during that time.

The underground project schedule has been delayed by longer than anticipated grouting activity due to high water volumes and the time necessary to transition to the main sinking phase of the project.

“Despite these challenges, the project continues to deliver strong economics paying back capital in under three years and adding approximately $4 billion in revenues from an extended mine life out to at least 2040, using conservative diamond price assumptions,” said Lucara CEO Eira Thomas. “The project also comes at a time when the long‐term outlook for the diamond market is stronger than it has been for many years representing an exciting growth opportunity for our shareholders and stakeholders in Botswana.”

Details of the Karowe underground project are available at www.LucaraDiamond.com.