18 July 2014

Zimbabwe: Diamond Production At Rio Tinto Up 20 Percent

DIAMOND production at Rio Tinto plc's 78% owned Zimbabwean producer, Murowa Diamonds (Murowa), has grown by 20% in the second quarter of 2014 to 83 000 carats, offsetting a 34% slump in output in the previous quarter, latest figures show.

In the first quarter of 2014, Rio Tinto's share of production at Murowa fell by 34% from the final quarter in 2013 to 69 000 carats due to lower grades.

"First half carats recovered at Murowa were four per cent higher than the first half of 2013 due to improved throughput and processing previously stockpiled material," said Rio Tinto in a half-year statement.

In the first half of the year, Rio Tinto's share of production at Murowa stood at 152 000 carats, up from 147 000 carats in the same period prior year.

On a year-on-year basis, Rio Tinto's share of production in the second quarter of 2014 was 21% higher compared to the same period last year. Murowa produced 69 000 carats in the first quarter of 2013.

In the first half, RioTinto produced a total 7,482 million carats-including output from the group's Argyle Mine in Australia and Diavik Mine in Canada which produced 4,92 million and 2,4 million carats in the year under review, respectively.

Rio Tinto owns 100% of Argyle and 60% of Diavik.

In June 2013, Rio Tinto reversed its decision to dispose of diamond operations after the market failed to meet its asking price.

The move disappointed seven potential suitors who had been linked to the takeover of Rio Tinto's entire stake in Murowa.

Murowa's operation is located near Zvishavane in South Central Zimbabwe and is owned 78% by Rio Tinto plc while the remaining stake is owned by Riozim Ltd, an independent Zimbabwean-owned listed company.

The company said three kimberlite pipes were discovered on the mine site in 1997.

"The resource has the potential to be expanded to 6-7 times its current production level. A review of the feasibility study for this expansion is currently underway, as are discussions with the Zimbabwean government on the required investment environment to support a project of this magnitude," said the company.

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