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Lucara splashed over P570 million on Karowe underground project

Karowe-underground-project

Top gem junior miner Lucara Diamond Corp is investing heavily on the expansion of its Karowe Mine. So far, the Canadian headquartered multi-listed miner has spent over P570 million on the project that will transform Karowe into a world-class underground mine.

In an update on Wednesday, Lucara said the Karowe underground project is in a fully financed position with the funds to be provided from the $220 million senior debt facilities package (the over P2. 4 billion announced on the 12th of July 2021).

Additional funds are also expected to come from the recently closed equity financing of C$41.4 million (over P330 million), and the projected cash flows from the Karowe open pit mine, during the underground construction period.

Although COVID-19 related delays have impacted the original schedule, Lucara says no material variances between the 2019 feasibility study and current project design have resulted following the completion of detailed design and engineering work undertaken in 2020 and 2021.

Total capital expenditures, including contingency have, however, increased marginally by approximately 4%, to $534 million (P5.9 billion), due to the increase in the production shaft diameter and additional mine development.

The Karowe underground project is planned to extend the mine life to at least 2040 mining predominately from the highest value EM/PK(S) unit, and is forecasted to contribute approximately $4 billion(over P40 billion) in additional revenues, using conservative diamond prices, starting in 2026.

So far $51.4 million(over P573 million) has been spent to date out of the total budget, primarily on engineering and procurement of long lead items. Lucara says this year alone a total of $120 million (over P1.2 billion) will be spent on the project.

From beginning of 2020 till June 2021 all critical path items were addressed, and a concerted effort was placed on detailed design, engineering and procurement which have helped to significantly de-risk the project.

The P573 million spent on the project to date, includes amongst others on shaft and geotechnical engineering, procurement of long lead time and essential shaft sinking items, surface infrastructure and construction activities, bulk power supply power line engineering and procurement.

Mobilization of the shaft pre-sink team commenced in late Q2 2021 with shaft pre-sinking on track to commence in mid Q3 2021. Open pit mining operations have been adjusted to limit the risk of production shortfalls during the ramp up of the Underground mine operations commencing in H1 2026.

The Karowe Mine is an existing conventional drill and blast open pit operation, with diesel excavators and trucks providing an average annual 2.6 million tonnes of kimberlite feed to the mill. The open pit mine operation is expected to terminate mid-2026, ending at an elevation of approximately 700 metres above sea level (“masl”).

The Underground project is targeting the substantial resources remaining below the economic extents of the open pit in the South Lobe. A 7,200 tonne per day shaft operation utilizing long hole shrinkage (LHS) mining will provide an additional 13 years of mine life to the Karowe operation after a five-year construction period.

The mine will be accessed from a 767-metre deep production shaft, 8.5 metres in diameter, driven from surface and will be equipped with two 21- tonne skips for production hoisting and a service cage for man and material movement through the mine.

This shaft will also serve as the main fresh air intake to the mine. A second shaft, 6.0 metres in diameter, driven 733 metres deep from surface, will form the main ventilation exhaust pathway. The LHS method is planned to systematically drill and blast the entire lobe on a vertical retreat basis.

In LHS, a significant proportion of the blasted muck is left in the stope during blasting and stoping to stabilize the host rock, with only the swell extracted during the drill and blast phase. Mucking will take place from draw points from the 310L (310 masl) extraction level. Once the column is fully blasted, the stope will be drawn empty by mucking the draw points.

The bottom-up approach of the LHS mining method takes advantage of the higher value EM/PK(S) kimberlite unit at depth in the South Lobe at Karowe, and balances high initial capital costs with low operating costs while de-risking the project with respect to the geotechnical and hydrogeological aspects of the host rocks.

Furthermore, there will be parallel pre-sinking of shafts, ventilation fans and coolers to be located on surface, in shaft grouting of water strikes changed from grout curtain installation from surface, planned development of an additional sublevel to assist in drilling of drawbells.

Civil works for the underground expansion progressed through detailed design, and construction activities ramped up through Q1 2021 with completion of the construction area terraces, laydown areas, shaft pad preparations, along with commencement of shaft collar box cut construction and blasting within the shaft columns in preparation of civil works.

Hoist houses, hoist foundations and shaft collars are now well advanced and on time for commencement of pre-sinking which is planned during Q3 2021. To date, over 430 days have been worked LTI-free, on the project. Temporary power for shaft sinking is required until such time as the upgrade bulk power supply infrastructure is commissioned in Q4 2022. A three phased ramp up of the generator capacity is planned to support the increasing power requirements related to the shaft sinking activities.

A power supply and services contract for the temporary generators has been signed with Aggreko International Projects Limited. Mobilization has been initiated with the generator pad established. Commissioning of Phase 1 is scheduled during Q3 2021 to support the start of pre-sink activities.

Bulk Power Supply During 2020, Lucara negotiated and signed a self-build agreement with the Botswana Power Corporation (BPC) for the construction of two substations and a 29 km long 132kv Transmission line from BPC’s newly established Letlhakane substation to the Karowe mine.

The planned route follows an existing regional 400kV line and then runs parallel to the existing 11kV transmission line currently supplying bulk power to the Karowe mine. The new power infrastructure will provide the required power for the current open pit, processing plant and the underground mine expansion. Commissioning of and handover to BPC is scheduled for Q4 2022. Construction of substations is scheduled to commence in Q3 2021 and power line construction in Q1 2022.

Next steps on the Karowe Underground development will include mobilization to site and start of pre-sink in Q3 2021, completion of early civil works in Q4 2021, continuation of detailed design and engineering of the underground mine infrastructure and layout, commencement of bulk power supply infrastructure with substation construction scheduled to start in Q3 2021, and transmission line engineering in H2 2021.

Lucara President and Chief Executive Officer, Eira Thomas, said the company has made tremendous progress on the Karowe underground expansion project over the last eighteen months, despite the challenges imposed by the global pandemic.

“This project comes at a time when the outlook for the diamond market is stronger than it has been for many years representing an exciting growth opportunity for our shareholders and stakeholders in Botswana,” she said on Wednesday.

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Food prices continue to rise, but at a slower rate

28th November 2022

Prices for cereals or staple foods in Botswana and other Southern African countries continue to rise at a slower pace, following trends in the global markets, according to the latest November 2022 Food Price Monitoring and Analysis by Food Agricultural Organization (FAO) of the United Nations.

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Still doing business the old way?

18th November 2022

It’s time to get business done better with MTN Business Botswana’s ICT Solutions.

Running a digital businessMTN Business Solutions Botswana, popularly known as MTN Business is an Internet Service Provider. We are a subsidiary of MTN Group Limited, a multinational telecommunications Group headquartered in South Africa, which operates in 19 markets across Africa and the Middle East.

More and more, clients are looking for ways to keep their staff productive in a dynamically changing business environment. Whether your people are working from home, the office or abroad, there is a growing recognition that digitising your operations can offer unprecedented commercial value in flexibility, productivity and growth. This new, digital reality means that it is more important than ever to stay agile – if there is anything that can slow a business down, it is being burdened by othatld technology.

Having made substantial investments in fibre technology, high-speed terrestrial and undersea networks and new frequency spectrum across the markets wherein it operates, MTN is perfectly positioned to respond to this shift in the market.

A few years ago, MTN also made the decision to build an IP capable radio network for its mobile services, giving its core network the ability to seamlessly integrate with enterprise IP networks. The mobile towers deliver services to enterprise clients absolutely anywhere it has a network, shortening the last mile and removing complexity and cost.

Now there is increasing demand from clients to connect their remote sites in all areas, including rural and semi- rural. MTN has assisted clients with overcoming this connectivity hurdle, enabling their staff to get the job done wherever they are.
MTN’s evolution

For MTN, the focus has shifted from just being a core telecommunications services provider, towards also becoming a technology solutions provider. The service offering now also includes Unified Communications, Data Hosting and Cloud Solutions, Security-As-A-Service and Managed Network Services. The scope has changed to being client and industry specific, so the requirements and service portfolio vary from one client to the next. The expectation is that a company like MTN must respond to these challenges, helping clients to get business done better as they shift from old to new technologies.

As many businesses continue to grapple with a digitally dynamic world, they face new challenges that have to be solved. This environment will benefit those that are more digitally enabled and agile. It is a brave new world that will favour online over on-site, wireless over wired and fluid over formulaic. Businesses will seek out partners and suppliers that are every bit as flexible and forward-looking as they are.
Ultimately, clients need partners like MTN Business that will invest in infrastructure, deliver the services they require, have market credibility, are financially sound and have a long-term commitment to their market presence.

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BIE to vitalize the Dignity of Engineers

9th November 2022

Botswana Institution Of Engineers (BIE), has last week hosted a gala dinner in  which they appreciated engineers who worked tirelessly and with dedication for 10 years from 1983 to steer the BIE to its current status.

The event that was held at the Phakalane Golf Estate had brought together young, experienced and veteran engineers and was held under the theme “Vitalize the dignity and eminence of all professional engineers”.

Explaining the theme, the institution’s treasurer, Thanabalasingam Raveendran said that engineers were looked upon reverentially with respect as the educated but with time it seems to have deteriorated. He indicated that there is a need to change the narrative by all means.

“The BIE exists for the welfare and the betterment of us Botswana engineers, we need to recognize specialised units within our Institution. We Engineers strongly believe in Engineers make it happen” Raveendran said.

He indicated that under the theme they appeal to all engineers to energize, to attain quality of being worthy of honour and respect and to achieve recognized superiority amongst the Society.

Raveendran stated that engineers need to ensure their end product is of good quality satisfying the end users expectations and engineers must be honest in their work.

“Approximately 8000 engineers registered with Engineering Regulatory Board (ERB) are not members of the BIE, engineers need to make every effort to recruit them to BIE” he said.

He alluded that BIE being a society, it currently needs to upgrade itself at par with professional institutions elsewhere like the UK and USA.

He further stated that BIE has to have engineering units of specialised disciplines like Civil/Mechanical/electrical etc

“As President Masisi indicated in his inaugural speech, the young people, who make 60 percent of the population of this country, are the future leaders and therefore investing in them is building the bridge to the future” said Raveendran

Kandima indicated that BIE has a memorandum of Understanding with Engineers Registration Board (ERB), where BIE is a recognised provider of CPD training, mentorship programmes and more importantly IPD undertaking to upgrade the skills and know-how of our engineers.

“For us to achieve our mandate and make worthwhile changes to engineering in Botswana, we have to be totally focused and act with intent” said Kandima.

Furthermore, Stephen Williams, past president of the BIE from 1986-1988 told the engineers that  the BIE provides a fertile environment where they can meet, share ideas and grow professionally.

“The BIE is also a nesting place for graduate engineers to learn from their peers and seniors, it also cater for engineering technicians and technologists and so nobody in the technology field is left out” he said.

He further indicated that Botswana Government provides a conductive environment for growth of engineering professionals.

“It must be stated that the Botswana Government recognises the existence of BIE and it can further be stated that the government enables ERB to carry out its mandate as a regulator of engineering professionals” said Williams

He plead with engineering companies to recognize and support BIE as it is the only source of engineering personnel’s for various Industries .

Furthermore, when giving his farewell speech, Michael Pinard , a past president of the institution  said how they are viewed as engineers by the general public might be due to some lack of appreciation as to exactly what role they play in the development of the country.

“The BIE slogan is aptly coined-Engineers make it happen, in other words, what man dreams engineers create” Said Pinard.

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