(Sharecast News) - BlueRock Diamonds warned on Friday that full-year production was likely to be at the lower end of its guidance range following the shutdown of operations at its Kareevlei mine in the Kimberley region of South Africa.
The company announced on Monday that the mine had been shut down following a visit by South Africa's Department of Mineral Resources and Energy (the DMRE), due to a deemed safety breach.
Although commissioning and processing restarted at the new plant on Thursday, the old plant has been closed.
BlueRock said it's now likely that production for the year to the end of December will be at the bottom end of guidance of between 22,000 and 26,000 carats.
"The suspension has impacted near term cashflow expectations, exacerbated by the fact that there is no planned diamond tender in Kimberley in December 2021," it said. "The company is assessing how best to meet its working capital needs over this period including the potential to finance December 2021 production through its existing relationship with Delgatto Diamond Finance LLP subject to progressing certain administrative matters."
BlueRock said it remains in talks with the DMRE in relation to the issues raised regarding the mining activities that remain suspended and "hopes to resolve these in the near future".
At 1600 GMT, the shares were down 6.3% at 37p.
31 Jul 2023 07:58
IN BRIEF: BlueRock Diamonds to exit administration via dissolution
BlueRock Diamonds PLC - South Africa-focused diamond miner - SP Angel Corporate Finance LLP steps down as nominated advisor. BlueRock's shares were suspended from trading on AIM back on February 24, due to financial uncertainty surrounding the company, and will be cancelled six months from that point, meaning around August 24. BlueRock is in administration and on Friday says it will exit via a distribution to preferential creditors and dissolution of the company, rather than a company's voluntary agreement. BlueRock says this follows significant correspondence with the proposed purchaser of its principal operating subsidiary, Kareevlei Mining Ltd, which itself has been placed into business rescue.
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