Canadian miner Lucara Diamond Corporation finds in an updated technical report that the underground project at its Karowe diamond mine, in Botswana, has the potential to recover 4.5-million carats over a ten-year mine life.

The company set out to update the feasibility study of the underground project to reinforce the company’s strategic decision to extend Karowe’s mine life and continue to generate benefits for stakeholders.

“We look forward to continue recovering large, exceptional diamonds from the underground project,” says Lucara president and CEO William Lamb, referring to Karowe having been the only diamond mine in the world to recover nine diamonds larger than 1 000 ct in weight.

The underground project at Karowe is estimated to generate revenue and cash flow to 2038 for a pre-production capital cost of $779-million. Lucara has already spent $436-million on the underground project over the last five years.

Lamb anticipates that the remaining pre-production capital costs of $343-million will be funded through a combination of operating cash flow, as well as new equity or debt financing. The company is collaborating with existing lenders and its major shareholder to consider its financing options.

The underground project currently has an after-tax net present value of $432-million.

Once production from the underground project starts in the first half of 2028, the company expects to generate more than $1.3-billion in net income over the mine life of the project.

Lamb explains the underground project is focused on the highest value domain of the South Lobe of the AK6 kimberlite which continues at depth below the openpit. The project is being designed to support the operation of a 2.85-million-tonne-a-year underground mine and processing plant, particularly as the Karowe openpit mining operations come to an end in the first half of this year.

Lucara will process stockpiled ore during the latter part of the underground project’s development until ramp-up to full production in the first half of 2028.