Modern Mining April 2021

Lucara announces 24-month extension to HB supply agreement Not only have rough diamond prices expe- rienced a positive re-bound over the past two quarters, Lucara is also beginning to see the benefits of this strategy in access- ing a broader marketplace and delivering regular cash flow based on final polished sales.

Lucara Diamond Corp has entered into a 24-month extension of its definitive sup- ply agreement with HB Antwerp (HB), in respect of all diamonds produced in excess of 10,8 carats in size from its 100% owned Karowe Diamond Mine in Botswana. Large, high value diamonds in excess of 10,8 carats in size account for approxi- mately 70% of Lucara’s annual revenues. Though the Karowe mine has remained fully operational throughout the COVID-19 pandemic, Lucara made a deliberate deci- sion not to tender any of its +10,8 carat inventory after early March 2020 amid the uncertainty caused by the global crisis. Under the terms of this novel supply agreement with HB, extended to December 2022, the purchase price paid for each +10,8 carat rough diamond is based on the estimated polished outcome, determined through state of the art scanning and plan- ning technology, with a true up paid on actual achieved polished sales thereafter, less a fee and the cost of manufacturing. Advantages include regular cash flow for Lucara using polished pricing mechanism; potential revenue upside, particularly suited for Lucara’s large, excep- tional diamonds; increased tax revenue and additional beneficiation opportunities for the Government of Botswana; and a streamlined supply chain that achieves alignment between Lucara and HB to maxi- mise the value of each +10,8 carat diamond produced at Karowe. CEO Eira Thomas comments: “The deci- sion to sell our +10,8 carat rough diamonds under a committed supply agreement with HB beginning in July of 2020 has helped support prices for this critical segment of our production amidst pricing uncertainty caused by the ongoing global pandemic.

“We believe these early results warrant an extension of the arrangement for at least 24 months to determine if superior pric- ing and market stability for our large, high value diamonds can be sustained longer term, creating better alignment between all participants and the establishment of a healthier, more efficient global diamond supply chain.” Oded Mansori, CEO HB Antwerp: “More than a supply agreement, this collaboration structurally embeds a new transparent and sustainable way of working in the diamond value chain. For the first time, different part-

Large, high value diamonds in excess of 10,8 carats in size account for approximately 70% of Lucara’s annual revenues. ners of the value chain are fully aligned, sharing data and information throughout the process from mine to consumer.” 

Ben Munanga appointed chairman of Kamoa Copper Ivanhoe Mines (TSX: IVN; OTCQX: IVPAF) has announced the appointment of Ben Munanga as chairman of Kamoa Copper’s board of directors. Kamoa Copper is the Democratic Republic of Congo (DRC) oper- ating company of the joint venture between Ivanhoe Mines, Zijin Mining Group, Crystal River and the Government of the DRC that is developing the Kamoa-Kakula Copper Mine. Munanga has been the GM of Ivanhoe Mines Energy DRC (IVEN) – a sister company of Kamoa Copper that is responsible for deliv- ering reliable, clean, renewable hydropower to the Kamoa-Kakula Copper Mine – since August 2015. Prior to joining IVEN, Munanga was the head of Power, Infrastructure & Bulk Services with Eurasian Natural Resources Corporation (ENRC) since 2009.

Munanga is chairman of the Energy Commission of the Chamber of Mines. Before joining the mining industry in 2006, he held various senior positions in Eskom, South Africa for 11 years. In a concurrent move, Olivier Binyingo, Ivanhoe Mines’ vice president Public Affairs DRC, was appointed to the board of directors of Kamoa Copper to further enhance Kamoa Copper’s collaboration with government partners and local communities. Munanga replaces Louis Watum as chair- man of Kamoa Copper’s board of directors. Watum has been appointed GM of Ivanhoe’s Kipushi zinc-copper-silver project, a joint- venture with the DRC state-owned mining company La Générale des Carrières et des Mines (Gécamines). 

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