Dominion Diamond reports results of Fox Deep prelim. economic assessment
Dominion Diamond reported the results of a preliminary economic assessment on the development of an underground operation below the mined out Fox open pit at the Ekati Diamond Mine in the Northwest Territories of Canada. The Fox kimberlite pipe is located in the Core Zone Joint Venture in which the company has an 88.9% participating interest. Highlights include: Preliminary economic assessment on Fox Deep project based on underground incline caving mining method, with incremental post-tax net present value at 7% discount rate of $187 million and internal rate of return of 23%; PEA based on processing of 31.3 million tonnes and recovery of 11.0 million carats from Fox Deep; Fox Deep would extend the mine life at Ekati to fiscal 2042 from fiscal 2035, which reflects inclusion of the recently-approved Misery Deep project; Initial capital development of $628 million, sustaining capital of $192 million, and total operating expenses of $1.4 billion or $51 per dry metric tonne processed; Base case diamond price of $232 per carat based on the company's July 2017 Price Book, increased at 2.5% per annum during the life of the mine; Pre-feasibility study on Fox Deep underway and on track for completion in late fiscal 2018.