Name of the Project
Merlin diamond mine restart.

Location
Northern Territory, Australia.

Project Owner/s
ASX-listed Lucapa Diamond Company.

Project Description
Lucapa plans to restart production at the Merlin diamond mine.

The mine comprises two phases. 

Phase 1, which comprises the Gawain, Ywain, Palomides, Sacramore and Excalibur pits, will use excavator dredging to mine to a depth of 15 m from the base of the five existing openpits. An estimated 67 000 ct are expected to be recovered in this phase.

Phase 2 will use vertical pit mining to extract ore from the Gawain pit and will recover about 247 000 ct. 

Drill-and-blast methods will be used to mine the openpit waste. Mechanical mining using a surface miner will be used for ore mining in the openpit and all vertical pit mining. The development of the decline and crosscuts will be conducted by conventional drill-and-blast.

A 355 000 t/y process plant will be built on the existing plant site, primarily using equipment already available at Merlin.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a forecasted pretax net present value, at a 10% discount rate, of A$40-million and an internal rate of return of 75%.

Capital Expenditure
Phase 1 requires A$15-million in funding, with A$9-million as preproduction capital.

Phase 2 requires A$10-million in funding for a proposed five-year mine life with extension potential.

Planned Start/End Date
Phase 1 will be conducted over 18 months, with Phase 2 following for 27 months.

Latest Developments
Lucapa Diamond Company has identified two large, highly conductive base metal targets.

The findings are the result of the first geophysical survey conducted at Merlin in 25 years and highlight the project's potential for mineral discoveries.

The targets were identified through a helicopter-borne time-domain electromagnetic survey that covered the 234 km², including the Merlin mineral lease and the surrounding exploration licence. These targets occur along structures in proterozoic sediments, sharing striking similarities with the geology of the world-class McArthur River zinc/lead mine, located  50 km to the north.

“Given the highly prospective nature of the targets identified, we are already considering the next phase of exploration," Lucapa MD Alex Kidman has said.

Lucapa plans to proceed with ground-based geophysical surveys to further define the newly discovered targets and refine exploration efforts.

Key Contracts, Suppliers and Consultants
Not disclosed.

Contact Details for Project Information
Lucapa Diamond Company, tel +61 8 9381 5995 or email  general@lucapa.com.au.