Gemfields reports output fall at Kagem

Output at Gemfields’ 75%-owned Kagem Mining in Zambiat totalled 4.7 million carats of emerald and beryl with an average grade of 156 carats per tonne in the three months to the end of December compared with 8.2 million carats with an average grade of 272 carats per tonne a year ago.

Total operating costs was $10.2m compared with $12.1m a year ago.

The auction of predominantly higher quality rough emeralds from Kagem mine that was initially scheduled in December is now going to take place this month in Lusaka, Zambia.

Production for the group’s 75%-owned Montepuez Ruby Mining in Mozambique totalled 1.1 million carats of ruby and corundum with an average grade of 12 carats per tonne in the quarter compared with 1.6 million carats with an average grade of 22 carats per tonne a year ago as a result of the lower grade, but higher value material being processed.

Total operating costs were US$6.6m against $6.9m a year ago.

The group said Faberge orders agreed during the quarter ending 31 December increased by 95% on a year ago.

The number of sales transactions during the quarter increased by 48% when compared to a year ago while the average selling price per piece increased by 12%.

Chief executive Ian Harebottle said: “This quarter has seen Montepuez continue to deliver strong results, with a significant increase in ore processed relative to the prior comparable period as a result of improved operational efficiencies.

“This performance is particularly pleasing given the results have been achieved despite a planned temporary shutdown of the wash plant to allow for substantial upgrades.

“This included the installation of a new scrubber, de-grit unit and Dense Medium Separation unit.

“Traditionally used in the diamond sector, this is the first time a DMS plant has been used in ruby production.

“We are very pleased with the initial results and are anticipating a significant uplift in processing rates over the coming months.

“Kagem has seen a mixed quarter with the reduced volumes of production, as a direct result of the varied nature of the mineralisation at the deposit, being countered to some extent by the sterling efforts of our operating team on site.

“During the current quarter their focus was on further improving operational efficiencies while exploration and bulk sampling activities at the Fibolele and Libwente sectors continued at a steady pace.”

At 9:23am: (LON:GEM) Gemfields PLC share price was -0.63p at 49.75p

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