Dominion Diamond Corporation Website Background Image

Dominion Diamond Corporation Reports Diavik Diamond Mine Fourth Calendar Quarter Production

January 18,2016

YELLOWKNIFE, Northwest Territories--(BUSINESS WIRE)--Jan. 18, 2016-- Dominion Diamond Corporation (TSX:DDC, NYSE:DDC) (the “Company”) reports Diavik Diamond Mine production results for the fourth calendar quarter of 2015:

Diavik Diamond Mine Production (100% basis)

   

Q4
2015

  Q3
2015
  Q2
2015
  Q1
2015
  Q4
2014
  Q3
2014
  Q2
2014
  Q1
2014
Tonnes processed (millions) 0.46 0.48 0.56 0.48 0.51 0.56 0.62 0.59
Carats Recovered (millions) 1.50 1.27 2.14 1.50 1.54 1.67 2.15 1.87


Processing volumes in the fourth calendar quarter of 2015 were 9% lower than the same quarter of the prior year due primarily to three weeks of maintenance shutdowns in the processing plant.

Diamonds recovered in the fourth calendar quarter were 3% lower than the same quarter of the prior year reflecting lower processing volumes which was partially offset by a higher recovered grade.

Diamonds recovered in calendar 2015 of 6.4 million carats were 9% lower than the original calendar 2015 plan of 7.0 million carats due to a combination of ore availability issues resulting from lower mining rates from A-154N and lower grades from A-418 earlier in the year, and availability of the process plant in the fourth calendar quarter.

The development of the A-21 pipe continues to progress according to plan.

A new mine plan and budget for calendar 2016 is under review by Rio Tinto plc and the Company.

     
Run of Mine Production – Calendar 2016

Diavik Diamond Mine (100% basis)

Tonnes Mined
(millions)

Tonnes Processed
(millions)
Carats
(millions)
Preliminary Mine Plan for Calendar 2016 2.1 2.1 7.0


Mining activities will be exclusively underground and ore will be sourced from the following kimberlite pipes in the approximate amounts noted below:

Diavik Kimberlite Pipes (100% basis)   Tonnes Processed
(millions)
A-154 South 0.5
A-154 North 0.7
A-418 0.9


In addition to the 7.0 million carats produced from run of mine ore, there will be a small amount of production from COR. This additional production is not included in the Company’s ore reserves, and is therefore incremental. Based on historical recovery rates, the tonnage of this material that is planned to be processed during calendar 2016 would produce 0.1 million carats from COR.

The aforementioned mine plan for the Diavik Diamond Mine was prepared and verified by Diavik Diamond Mines (2012) Inc. (“DDMI”), operator of the Diavik Diamond Mine, under the supervision of Calvin Yip, P. Eng., Principal Advisor, Strategic Planning of DDMI, and a Qualified Person within the meaning of National Instrument 43-101 of the Canadian Securities Administrators.

Diavik Diamond Mine Production 40% basis

For the three months ended December 31, 2015   For the three months ended December 31, 2014
Pipe   Ore Processed
(000s tonnes)
  Carats
(000s)
  Grade
(carats/tonne)
Ore Processed
(000s tonnes)
  Carats
(000s)
  Grade
(carats/tonne)
A-154 South

55

202 3.66 45 176 3.93
A-154 North 46 100 2.18 77 159 2.06
A-418 84 290 3.44 82 270 3.29
COR - 6 - - 12 -
Total 185 598 3.19(a) 204 617 2.96(a)

(a) Grade has been adjusted to exclude COR

For the twelve months ended December 31, 2015   For the twelve months ended December 31, 2014
Pipe   Ore Processed
(000s tonnes)
  Carats
(000s)
  Grade
(carats/tonne)
Ore Processed
(000s tonnes)
  Carats
(000s)
  Grade
(carats/tonne)
A-154 South 210 760 3.61 200 760 3.80
A-154 North 253 541 2.14 357 766 2.14
A-418 328 1,186 3.62 350 1,278 3.65
COR 3 75 - 3 88 -
Total 794 2,562 3.14(a) 910 2,892 3.09(a)

(a) Grade has been adjusted to exclude COR

Pricing
Based on the Company’s sales during the fourth calendar quarter of 2015 and the current diamond recovery profile of the Diavik processing plant, the Company has modeled the approximate rough diamond price per carat for each of the ore types below.

Diavik Ore Type   December 2015 Average Price per Carat

(in US dollars)

A-154 South

 

$125

A-154 North

 

$165

A-418

 

$90

COR

 

$45


Forward-Looking Information
Certain information included herein, including information about mining activities and estimated production from the Diavik Diamond Mine, constitutes forward-looking information or statements within the meaning of applicable securities laws. Forward-looking information is based on certain factors and assumptions including, among other things, the current mine plan for the Diavik Diamond Mine; mining, production, construction and exploration activities at the Diavik Diamond Mine; required operating and capital costs; labour and fuel costs; currency exchange rates; world and US economic conditions; future diamond prices; and the level of worldwide diamond production. Forward-looking information is subject to certain factors, including risks and uncertainties, which could cause actual results to differ materially from what the Company currently expects. These factors include, among other things, the uncertain nature of mining activities, including risks associated with underground construction and mining operations, risks associated with joint venture operations, including risks associated with the inability to control the timing and scope of future capital expenditures, the risk that the operator of the Diavik Diamond Mine may make changes to the mine plan and other risks arising because of the nature of joint venture activities, risks associated with the remote location of and harsh climate at the Diavik Diamond Mine, variations in mineral resource and mineral reserve estimates, grade estimates or expected recovery rates, failure of plant, equipment or processes to operate as anticipated, risks resulting from the Eurozone financial crisis, risks associated with regulatory requirements and the ability to obtain all necessary regulatory approvals, modifications to existing practices so as to comply with any future permit conditions that may be imposed by regulators, delays in obtaining regulatory approvals and lease renewals, the risk of fluctuations in diamond prices and changes in US and world economic conditions, the risk of fluctuations in the Canadian/US dollar exchange rate and cash flow and liquidity risks. Actual results may vary from the forward-looking information. Readers are cautioned not to place undue importance on forward-looking information, which speaks only as of the date of this disclosure, and should not rely upon this information as of any other date. While the Company may elect to, it is under no obligation and does not undertake to, update or revise any forward-looking information, whether as a result of new information, further events or otherwise at any particular time, except as required by law. Additional information concerning factors that may cause actual results to materially differ from those in such forward-looking statements is contained in the Company's filings with Canadian and United States securities regulatory authorities and can be found at www.sedar.com and www.sec.gov, respectively.

About Dominion Diamond Corporation
Dominion Diamond Corporation is the world’s third largest producer of rough diamonds by value. Both of its production assets are located in the low political risk environment of the Northwest Territories in Canada where the Company also has its head office. The Company is well capitalized and has a strong balance sheet.

The Company operates the Ekati Diamond Mine through its 88.9% ownership as well as a 65.3% ownership in the surrounding areas containing additional reserves and resources, and also owns 40% of the Diavik Diamond Mine. Between the two mining operations, diamonds are currently produced from a number of separate kimberlite pipes providing a diversity of diamond supply as well as reduced operational risk. It supplies premium rough diamond assortments to the global market through its sorting and selling operations in Canada, Belgium and India.

For more information, please visit www.ddcorp.ca

Source: DOMINION DIAMOND CORPORATION

Dominion Diamond Corporation
Mr. Richard Chetwode, +44 (0) 7720-970-762
Vice President, Corporate Development
rchetwode@ddcorp.ca
or
Ms. Kelley Stamm, 416-205-4380
Manager, Investor Relations
kstamm@ddcorp.ca