Rockwell Diamonds Looking to Add Another Diamond Mine to its Portfolio
Rockwell Diamonds, owner of alluvial diamond mines in the Northern Cape and North West provinces in South Africa, is strategizing innovative ways to bring its Wouterspan property into production without significant upfront capital costs, according to CEO James Campbell.
In February, Rockwell brought two new mines—Saxendrift Hill Complex and Niewejaarskraal—on board, doubling their production capacity to 340,000m³ of gravel a month. Rockwell’s long-term goal is to mine 500,000m³ of quality gravel per month.
Rockwell now owns and operates three mines on the Middle Orange River and derives royalty revenue from its properties at Tirisano in North West, which are mined by third parties. Additionally, the company earns revenue from a joint venture in diamond cutting and polishing.
In an interview, Mr. Campbell said the first step towards the 500,000m³ production target would be incremental development at Niewejaarskraal, which is already delivering its expected value. Secondly, Wouterspan would need to be opened and process at least 350,000m³ a month to be economically viable.
Building Wouterspan as a conventional opencast diamond mine would be a costly undertaking, but Rockwell favored the internally funded and phased approach that it demonstrated in developing its two newest mines. Rockwell also needs to upgrade its mining fleet in order to increase efficiency.
Mr. Campbell said that the company has no plans to buy an expensive new fleet. A solution that did not involve a large capital outlay and was deemed appropriate for the small mining company had been found, with details to be announced in the next month.
By the end of the fiscal year in February, Rockwell had used C$1.7m of its overdraft. Although it generated net positive cash flow of C$2.7 million from operations, it spent C$8.7 million on its plant and equipment. This was mainly on the dense media separation, infield screen and bulk X-ray plant at Niewejaarskraal.
Compared with the previous year, revenue rose 39 percent to C$45.2 million and operating profit rose more than fivefold, from C$1.1 million to C$5.9 million. Production costs rose 25 percent to $39.2 million.
Mr. Campbell said that the rise in production costs was partly due to the fact that the Saxendrift Extension was 6km from the recovery plant, leading to additional transportation costs. It also resulted from the high costs of maintaining an aging mining fleet.
Rockwell Diamonds was founded in 1988 and is headquartered in Vancouver, Canada.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.