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11/5/19

Lucara Diamond Corp (LUC.to): Truth overcomes pumpjob

And the truth hurts:


The Karowe PFS is out and the numbers sting. However, those of you who paid attention to this IKN post from June last year were forewarned, unlike those naive fools who were led to the slaughter in this by Marin Katusa. A reminder of the IKN info that day:

Those of you who have visited Karowe will know that the open pit mine life has always been relatively short, even though the original pit was cut into basalt and had pitwall angles of around 60°. You'd normally think that under the circumstances of such competent host rock, they'd be able to avoid the mega-expense of a shaft and simply push back on the pit in order to extend open pit mine life. Sadly, that's not the case because as the open pit model matures the country rock has become sandstone, cannot support such a sharp angle and was flared out to around 40°. But then it gets even worse, because in the last couple of years of the open pit mine plan the pitwall moves into mudstone and the stability angle drops to a prohibitive 20°. That means it gets way too expense to cut back and the only way forward is to go underground, sink that shaft and go block caving. But even then, there's a serious geological issue at Karowe because normal block caving requires a competent host rock around your kimberlite pipe. LUC doesn't have that, it has sloppy mudstone all the way down so even after they raise a SLOM* from you retail monkeys currently buying into this pumpo, success is far from guaranteed.


With SLOM meaning "Shit Load Of Money." Further questions?