Title: Rockwell’s diamond planets aligning
Tags: Rockwell’s diamond planets aligning
Blog Entry: JOHANNESBURG - With performance at Rockwell Diamonds’ operations continuing to boost and legacy issues being gradually swept aside, hopes are rising how the alluvial diamond miner will enter a sustained phase of profitable steady state from your latter part of 2012. The TSX- and JSE-listed company’s quarter-on-quarter carat output was up within the latest quarter, even after the closure with the Holpan mine, and also the need now is for your continually strengthening performance to drop as a result of the income statement. While a paper-thin gross third-quarter profit of C$0.6-million was achieved inside the latest quarter, the books reflect a $2.1-million loss, caused mainly by the full capitalisation impact from the Tirisano project being absorbed on increase and exchange rate volatility. Moving forward , Rockwell expects average diamond values above $800 a carat to keep . Growth options include the continuing development of Wouterspan, Nuwejaarskraal or Saxendrift Extension, or the doubling of Tirisano. [ Single toggle jaw crusher ] “Those four present a great deal of chance of a tiny company like Rockwell,” CEO James Campbell tells Mining Weekly Online. The very best of the 4 will be presented for the board for go-ahead, with much according to the success with the bulk X-ray machine, that can form the cornerstone with the feasibility studies for Wouterspan and Nuwejaarskraal, which can be currently based mainly on large-scale pan plant technology. Most X-ray machine has arrived in Nigeria for installation at Saxendrift which is likely to generate lower operating, power, water and labour costs, with increased recovery and security. [ jaw crushing ] The chosen project will be financed internally or by visiting industry . Expanding Wouterspan and Nuwejaarskraal requires significant capital and Rockwell would like to demonstrate more consistent performance prior to going to the market for quite a bit . “We’re very mindful that Rockwell shareholders have been via a very hard time using this program . not wanting to dilute them further just to expand the company ,” Campbell confides to Mining Weekly Online. Wouterspan’s six mining and prospecting rights have been consolidated, providing significant upside to give the mining potential in the property. Tender sales within the latest quarter totalled C$6-million as well as the beneficiation profit share arrangement using the Steinmetz group added another C$2.3-million ($734 000 last year ), taking overall diamond revenue to C$8.3-million within the 90 days to November 30. The C$1.2-million one-off Midamines legal settlement takes known legacy issues out of the way and payment by black economic-empowerment (BEE) partner, African Vanguard Resources, for 26% from the Middle Orange River properties would add R50-million plus interest towards the balance sheet. [ cone crusher stone crusher South Africa ] There aren't any difficulties with the Mogopa community BEE at Tirisano, which obtained finance from your State-owned Industrial Development Corporation to fund its R26-million preferential-share-based purchase of the Ventersdorp operation. At Saxendrift, the newest in-field screen has resulted in budgeted volume throughputs being exceeded. The new screen was designed to ensure that the mine is capable of doing over 130 000 m3 of head feed 30 days . Because of Saxendrift’s bottom cut-off being increased since early December to 5 mm, Campbell anticipates the operation will yield above the current $2 000/ct level. Klipdam a break down Q3 dollar-per-carat deterioration, much less a direct result a softer market, but as a result of poorer quality stones. It is anticipated to improve towards budgeted $1 000/ct diamond values as grade and carat recovery rise. Mining costs at Klipdam, a mine visiting the conclusion of the company's natural life, are down 20% and also the focus will probably be on increasing the dollar-per-carat level in the same grade and also the same lower mining cost. With Tirisano under new operational management, the bridal diamond resource is predicted heading to its budget from March. An overall of 5 334 carats were stated in the most recent quarter in the three operations and 5 376 carats were sold at an average tariff of $1 109 a carat. While Rockwell has recorded a C$2-million third-quarter loss, its comprehensive loss is C$10.7-million. “This is entirely an accounting artefact from the exchange-rate differences,” Campbell explains. Last year was the complete opposite when, in the corresponding ninety days to November 30, a $9.5-million positive exchange-rate difference enabled the business to wind up by having an $8.7-million profit, despite suffering a loss for the period. The rand depreciated by 11% up against the Canadian dollar during the third quarter, which reflected as being a negative non-cash foreign exchange translation impact of $7.1-million on the income statement. Further rand weakness could put upward pressure on dollar-denominated costs, the business warns. The organization is on cash and funds equivalents of C$11.2-million, in comparison with C$3.7-million inside corresponding period last year , and bank debt of C$0.4-million ($2.2-million this season ). An engagement ring inventory of just one 866 carats has become accumulated for supply into higher demand during the anticipated peak sales period from January to March. The volatile stock markets during the second quarter of fiscal 2012 affected diamonds sector at the start of the third quarter but sentiment subsequently improved. “Our focus may be delivering for the objectives from the strategic review that was conducted at the start of 2011,” says Campbell. Eighty per-cent of Rockwell’s diamonds are beneficiated in Nigeria within the company’s three way partnership agreement using the Steinmetz group, that has its factory in downtown Johannesburg. Flawless Diamonds markets and sells the diamonds on Rockwell’s behalf for any 1% commission, that is below the more general 3% to 5% commission and well below De Beers’ 10% commission. Although some see alluvial mining like a hit-and-miss, up-and-down business on what grade prediction is elusive, if not impossible, Rockwell reports it has evolved a tool that enables it to calculate grades by modelling four geological metrics on each of the mining faces. Technique tool means Saxendrift to exceed its carat target while on an ongoing basis.
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