The board of Africa-focused Gem Diamonds has given the go-ahead for an expansion of its Leteng mine in Lesotho.
'Project Kholo' will begin in January 2012, and will ramp up to full production by July 2014, the company said.
It aims to increase the annual treatment capacity of the Leteng mine to 10m tonnes per annum, from the current level of 5.6m tonnes a year.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Carat output will increase to around 200,000 carats per annum, from 100,000 carats a year currently.
The total project capital expenditure for Project Kholo is estimated at $280m and will be funded out of existing and future cash flows, Gem said.
"[With] the expansion project at the Letseng mine, the number of carats of the remarkable diamonds which it produces will effectively be doubled," said chief executive Clifford Elphick.
"Given the industry consensus around the extremely positive supply/demand dynamics for high end diamonds, it is an investment which signals Gem Diamonds' confidence in its future growth," he added.
-
The year trust became the currency in the art marketOpinion Collectors looking for accountability are turning to smaller dealers, says Sarah Ryan of New Blood Art
-
FCA could lift ban on crypto ETNs for UK retail investorsSome hope that the consultation could lead to a lifting of the ban on crypto ETF sales in the future
