Firestone Diamonds' construction at Lesotho mine ahead of schedule

20th Jul 2016 13:10

(ShareCast News) - Construction at Firestone Diamonds' Lesotho mine is ahead of schedule and production is expected around October. In a trading update, the company said construction was on its Liqhobong diamond mine is 85% completed, ahead of its revised target of 81%. The plant is currently 18% commissioned, which is also ahead of schedule.The AIM listed company now expects production from the mine to begin early in the last quarter of 2016, with full production rates expected to take at least six months.Firestone owns 75% of the Liqhobong diamond mine and 25% is owned by the Lesotho government.The revised capital budget of 2.1bn South African Rand ($146.9m) remained within the original budget of $185.4m, as of 30 June $142m or 75% of the budget has been spent.The cash on hand at the end of June was $10.7m and the company had $39m available pursuant to the Amalgamated banks of South Africa (ABSA) debt facility, resulted in a forecast of about $9m as at the end of December. This did not include the $15m standby facility available to Firestone.Production guidance for the financial year ending June 2017 was between 1.8m to 2m tonnes and the first diamond sales are expected to be in January 2017.So far 2.6m man hours have been worked on the mine and the company's zero lost time injury record was maintained."I am pleased to report that construction activities at the Liqhobong Diamond Mine have continued to progress well over the last quarter," chief executive Stuart Brown said."As at the end of June, construction was ahead of schedule and initial production is now expected in early fourth quarter of 2016. The company remains fully financed throughout its ramp-up period and expects to host its first diamond sale in January 2017."The excitement and momentum is building nicely and we are looking forward to the recovery of our first carats in the fourth quarter of 2016."Shares in Firestone Diamonds were up 15.94% to 37.10p at 1458 BST.