KIM kimberley diamond company nl.

Kimberley The cost of profit

  1. 32 Posts.

    Kimberley Diamond Co told asx on 27 March 02 the result of a bankable feasability which showed a base case mining cost for the Pipe 4,9 mine of $11.21 per tonne for a capital Cost $2.6 m plant capable of 700,000 tonne per year throughput. A most likely case scenario of incorporating an inline pressure jig reduced the production cost to $8.83 . These are projected costs .
    From KIM release to asx on 9 October 02 3 sets of facts emerge
    (1) Year 1 operation of the plant using Pipe 9 feed has produced 15800 carots in the first qtr Full year production will be at least 70000 carots due to increased throughput in Dec qtr At $250 per carot gross sales for the first year will amount to $17.5 million With plant doing 720000 tonnes per annum mining costs would be $8.83 per tonne $6.35 million Profit before royalties would be over $10 million in Year 1 remember no tax payable as company books carry tax losses in excess of $50 million
    (2) Year 2 on pipe 4 near surface high grade reservesover 800000 tonnes grading 20.4 c/p/100tonnes @ $182 per carot = $27 million gross sales for year 2Mining costs still $8.83 per tonne =Year 2 profit $21 million

    (3) Year 2 spend $2.6 million duplicating plant use lower grade reserves proven at Pipe 4 (7500000 tonnes @ 11.34 c/p/100tonnes ) @ $182 per carot . Year 2 profit approx $15 million bearing in mind it will take 10 years to process this area alone at approx 720000 tonnes per year

    Add (2) and (3) together and we have a year 2 profit of $26 million.
    As we can see profit is dependent on production costs. Less than $10 per tonne Good Profits $15 per tonne Average Profits $20 per tonne Leave the diamonds in the ground!Mining production costs should be in the quarterly report due by end of this month
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Currently unlisted public company.

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