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Rough Diamond Production Boost by Rio Tinto (Diamond World News Service)
A strategic planning and development team is studying how best to extend the life of Diavik operation underground and also to oversee the development of the A-418 dike as well as the exploratory decline...
By: Administrator
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Jun 27 2006 12:00AM
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Reference: 2077  

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Rio Tinto, one of the diamond mining majors, has announced plans to increase its rough production. For this, while on the one hand, it has taken up exploration programs for diamonds in several countries across the world, on the other hand it is taking steps to extend the life-span of its existing mines.

Wider Global Exploration :
So far as global explorations are concerned Rio Tinto is searching for diamonds in several regions including Southern Africa, Mauritania, Brazil and India, apart from some new locations in Canada.

Its exploration team which is engaged in this activity has already discovered a number of diamond-bearing Kimberlites and follow-up test-work is in progress to gauge their economic potential. The Indian diamond exploration program, according to the team is showing early promise.

Existing Mines to be Upgraded :
Simultaneously, work is now on at the existing mines to step up their production and to extend their life.

A strategic planning and development team is studying how best to extend the life of Diavik operation underground and also to oversee the development of the A-418 dike as well as the exploratory decline.

In order to make it possible to remove water from a part of the lake and make more area available for open-pit mining there, the group technicians and engineers have undertaken construction of A-418 dike in the midst of the lake and also digging an exploratory decline. Construction of this dike has already been completed before the end of 2005. As this wall in the midst of water has already separated a portion of the lake, water will be sucked out from there. This will be followed by the pre-stripping of the lake-bottom there. This work is expected to continue until 2008. Once that is over, open-pit mining of the A-21 pipe is expected to commence.

Meanwhile, construction of the exploratory decline which commenced in 2005, will be pushed further. Already, one kilometre-long tunnel has been constructed. Under ground study is in progress there.

Bulk Sampling Commences :
Bulk sampling of the A-21 Kimberlite has commenced to ascertain whether the resource there can be re-classified as reserve and can be included in the Diavik mine-plan. This study is expected to be completed in 2006.

Diavik to yield More :
Meanwhile, achieved production of rough diamonds at Diavik rose from 7.575 million carats in 2004 to 8.272 million carats in 2005. Accordingly Rio Tinto’s 60 per cent share from that yield also rose from 4.645 million carats in 2004 to 4.963 million carats in 2005. It is hoped that Diavik production may cross 9 million carats and inch towards 10 million carats in 2006.

Argyle Promises Much :
At Argyle, which is wholly owned by Rio Tinto, the work on the proposed underground mining is expected to be speeded up in 2006, now that the Rio Tinto Board has already approved such development under the AK-1 open-pit. The Board has also simultaneously approved an open-pit cut-back on the Northern bowl to facilitate the transition from open-pit to underground mining. The capital cost of the underground mining is estimated at US$ 760 million, while the cut back is estimated to cost US$ 150 million. As already announced by Rio Tinto, on completion of this program the life of Argyle mine will get extended upto 2018. The necessary construction work at Argyle has already started since February 2006 and the development work associated with the exploratory decline is expected to proceed through 2006.

Meanwhile, actual production of rough diamonds which had fallen at Argyle as low as 20.62 million carats in 2004 due to adverse working conditions, picked up there after reaching nearly 30.48 million carats in 2005. During the current year, it can be expected to remain around that level, when however, the under ground mining starts from 2009 onwards, the level of production at Argyle is expected to fall to 60 per cent of its average level of output. This is because the pipe might be narrower underground. The Indian diamond manufacturing industry has however heaved a sigh of relief following the decision to extend the life of this mine as India depends heavily on the processing of Argyle rough.

Murowa Getting Developed :
At Murowa (Zimbabwe) in which Rio Tinto has about 78 per cent stake, production started in late 2004, after a sum of US$ 11 million was spent to develop mining facility and the necessary infrastructure there.

The small scale Murowa operation is focussed on 1.3 million tonnes of weathered material, containing 1,40,000 tonnes of enriched ore. A small modification was made in the front-end of the Murowa pant in mid-2005 to increase the through put rates. This modification made is possible for that plant to reach its target. Actual production of rough at Murowa increased from 47,000 carats in 2004 to 2,51,000 carats in 2005. Rio Tinto’s 78 per cent share also consequently rose during the period from 36,000 carats in 2004 to 1,95,000 carats in 2005.

Meanwhile, Rio Tinto has also embarked on a new phase of business improvement. Under the leadership of Rio Tinto’s Chief Executive Diamonds, Keith Shonsen these initiatives are intended to enhance collaboration around Rio Tinto’s various businesses to deliver additional value.

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