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(Image via Diamcor Mining. Click image to enlarge) image: https://stockhouse.com/getmedia/8ec8ffe8-2fa0-4080-a54a-3812cdab2c5d/092519-diamcor0logo?width=210&height=65
How often do you use a machine without fixing it? Maybe changing your car’s engine is too expensive, or your lawnmower does a
good enough job, or you’ve become used to your choppy internet reception.
For companies, wasted efficiencies are wasted capital. Even the most robust operations, after a long enough time, need to be re-evaluated. Techniques change, industry standards improve, and new operating practices add value in where you didn’t know there could be value added.
Each company in the mining industry should be constantly keeping their practices up to date, but few follow through. It’s one of the most cost-effective methods of improving everything from mining output to financials and future prospects, and makes sure that the project stays up-to-date and competitive.
So when
Diamcor Mining Inc. (
TSX-V:DMI,
OTC:DMIFF,
Forum) included improvements to operations in its most recent news release, investors should pay attention. The
Sept. 19 announcement first highlighted the diamond mining company’s latest successful tender of rough diamonds in the quarter,
3,759.62 carats sold for gross revenues of US $569,059.18. That doesn’t include an additional 4,825 carats stock that’s already been delivered to Antwerp for tender and continuing production to further add to sale inventory.
The highlight, however, was Diamcor’s improvement in total rough diamonds tendered, sold, and delivered. How did the executive manage the improvement? By figuring out inefficiencies and enhance the operations at the Company’s Krone-Endora at Venetia Project in South Africa.
The Company has been carrying out exercises using a new operational management team to find out where the already-successful diamond project can be improved. One such case was the evaluation of historical processing practices, including historical tailing and stockpiled material. The initial results alone helped Diamcor iron out and improve efficiencies to some of its operations.
Diamcor Mining’s President and CEO, Dean Taylor, commented on the operating exercises driving the Company forwards in efficiency:
"I am very pleased with the results being delivered by our new operational management team, who have not only confirmed their ability to identify past inefficiencies in both our processing facilities and operations, but also demonstrate their ability to correct these issues and enhance operations moving forward. We believe the current efforts, focus, and results will benefit the Project in a meaningful way moving forward.”
The Company’s release also noted that the boost to long-term efficiency positively affected the short-term. Some of the Company’s operating costs associated with heavy equipment and fuel were reduced.
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(Image via Diamcor Mining. Click image to enlarge) For Diamcor, the timing couldn’t be better. Stockhouse
recently covered Diamcor’s push to expand on its successful Krone-Endora project with a round of financing of up to CD $1 million, which was announced as successful and overfilled on
Aug. 26.
Impressively, not only was the financing successful, but the most recent tender of diamonds improved compared to the previous sale. The average price tendered increased to US $151.36 per carat from $143.50 per carat, and Diamcor expects that it will be able to bring the price higher in short order.
That’s because the ongoing efficiency exercises were expected to cause recovery of a higher percentage of smaller, lower quality rough diamonds for a short time. Factoring in some slightly lower market prices, and the improved proceeds were still below Diamcor’s average price per carat of US $176.16.
But compared to the long-term gain of the improved operating efficiencies, the investment already appears to have been worth it. Newly mined material will go through the refined process facilities with increased recoveries, and the initial exercises still recovered larger gem quality rough diamonds, including a 20.66 carat gem and 28.45 carat gem.
Diamcor is set to continue carrying out its operational exercises and report increased efficiencies, and it has the capital to do so. The Company’s recent round of financing is set to bolster its focus on work programme advancement, as well as support further increases in processing volumes through the deployment of additional operational equipment. And with a new operational management team, the Company also has the human capital to carry out its improvement strategy.
It’s rare in the mining industry to have the ability to improve production efficiencies, and rarer still for a company to follow through. But Diamcor saw an opportunity to significantly enhance an already successful project, and even in a short time, has seen it pay off. As investors wait for further operating efficiencies to be reported, it’s reassuring to see the Company’s commitment to success.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.