25 April 2017
Toronto and New York, April 25, 2017 – Mountain Province Diamonds Inc. (“Mountain Province”, the “Company”) (TSX: MPVD, NASDAQ: MPVD) today announced the production for the first quarter ended March 31, 2017 from the Gahcho Kué Diamond Mine (“GK Mine”).
Highlights
• The GK Mine declared commercial production on March 1, 2017 having achieved more than 70 percent of nameplate capacity of 8,333 tonnes per day over the preceding 30-day period.
• Mining of overburden, waste rock and ore in the 5034 open pit for the three months ended March 31, 2017 was approximately 7.7 million tonnes, with approximately 222,600 tonnes of ore (100 percent basis) stockpiled at period end.
• For the three months ended March 31 the GK Mine treated approximately 492,000 tonnes of ore through the process plant and recovered approximately 867,000 carats on a 100% basis for an average grade of approximately 1.76 carats per tonne. The Company’s attributable share of first quarter diamond production was approximately 424,830 carats.
Mountain Province President and CEO Patrick Evans commented: “The production ramp-up at Gahcho Kué continued through the first quarter and we’re pleased to have declared commercial production on March 1, 2017. The ramp-up since the quarter end has continued smoothly and we expect the mine to achieve full production by mid-2017.”
During the quarter the Company completed three pre-commercial production diamond sales. These sales results will be reported with the Company’s first quarter financial results on May 11, 2017. Proceeds from pre-commercial production sales are being offset against capital expenditures. The Company expects the first revenues from post-commercial production sales during the second quarter of 2017.
Production sold during the first quarter was sourced primarily from the upper levels of the Northeast Lobe of the 5034 kimberlite, which has a higher population of lower quality diamonds than the average for the whole 5034 kimberlite. As a consequence, realized prices achieved during the first quarter were below the expected average for the 5034 kimberlite as a whole, but are expected to improve as market conditions normalize and more production is sourced from the Center Lobe of the 5034 kimberlite.
Mr. Evans added: “The first quarter diamond sales reflect the experience of a new entrant to the market, as buyers develop familiarity with the sell-through value of the Company’s production. The unexpected headwinds from demonetization in India compounded customary weakness during the price discovery period. Importantly, we have seen a steady improvement in our early sales results and are very encouraged that 72 percent of the winning bidders at our March sale were repeat buyers. We expect to work our way through the price discovery period by the middle of the year when we expect realized diamond prices to reflect market conditions.”
Based on results achieved to date, the Company today provided the following 2017 production guidance (100 percent basis):
• Tonnes mined: 40 million
• Tonnes processed: 2.7 million
• Carats recovered: 4.4 million
• Grade: 1.62 carats per tonne
In addition, the Company anticipates achieving a realized diamond price for the balance of 2017 of between US$70 and US$90 per carat.