Hello All
This today from DWM on Angola situation:
DiamondWorks updates situation in Angola
VANCOUVER, Nov. 26 /CNW/ - Bruce Walsham, President and CEO of
DiamondWorks Ltd., said today that the company is continuing its efforts to
locate its employees missing after the attack on the company's Yetwene diamond
mine in northeastern Angola more than two weeks ago.
Mr. Walsham said that the motive for the attack, and the identities of
the attackers, remain undetermined. ''We are pursuing every lead and working
with the authorities in Angola to find our missing employees.''
Reviewing the status of the company's two diamond mines in Angola, Mr.
Walsham said the company is preparing a plan for a resumption of production at
Yetwene, but is not yet in a position to schedule a start-up date. The
minesite was secured immediately after the attack and reports have confirmed
that the mining equipment and diamond processing plant are largely undamaged.
The attack and the resulting interruption of production have impacted on
DiamondWorks' cash flow and financial resources, which is affecting the
company's ability to service its financial obligations.
A protracted shutdown at Yetwene would seriously affect cash flow
projections and could hinder the company's ability to continue with existing
operations. Assuming that Yetwene can resume production in early January, the
company estimates that the costs relating to the attack, including lost
revenue, will total about US$5 million. Each additional month of lost
production would cost the company an estimated US$2 million.
Prior to the attack on November 8, the Yetwene mine had produced almost
3,000 carats in the first seven days of the month, a production rate of
between 10,000 and 12,000 carats per month. Prior to November, Yetwene had
been producing at a rate of about 6,000 carats a month - representing about
50% of the company's total diamond production - as the company completed the
commissioning of its new diamond processing plant. The average value of the
Yetwene stones sold to date is approximately US$200 a carat. In light of the
current shortfall in diamond revenues, and extraordinary costs relating to the
attack, DiamondWorks is now aggressively seeking alternative forms of funding.
Production is continuing at the company's other diamond mine in Angola,
the Luo mine, located 100 kilometres south of the Yetwene mine.
DiamondWorks launched an extensive review of security arrangements at
both its mines in Angola after the attack, including the commissioning of an
independent assessment. Steps have been taken to enhance security at all the
company's sites.
In response to a unanimous, collective appeal by all mining companies
active in the region, the Angolan government has substantially strengthened
security forces deployed to help safeguard mining operations. The companies
are holding further discussions with the government to assure a permanent,
higher degree of safety and stability in the mining areas.
Regards |
