BlueRock Diamonds PLC (LON:BRD) has raised gross proceeds of £1.5mln through an oversubscribed share subscription at 40p per share.

The money has been earmarked for working capital and to expand annual production at the Kareevlei mine in South Africa to 1mln tonnes by the second quarter.

BlueRock added that despite the disruption caused by weather and Covid-19 it is maintaining the bottom end of its production guidance for the year, which is “34,000 carats (more than double 2020) at a price of in excess of USD330 per carat.”

 Mike Houston, the executive chairman, said: “The need for further funding is frustrating but sadly unavoidable given the extreme weather conditions from mid- December to end-January and the lower sales prices that we experienced in Q4 2020 due to the absence of competitive tenders in South Africa.

“The rains, resulting in 29 production days being lost, had a similar impact on the Project, delaying the completion of the crushing circuit and ongoing development of the processing side of the new plant.  

“I am pleased to report that the new crushing circuit is now operating at expected levels and having a positive impact on production levels by ensuring a consistent supply of crushed material to our current plant. 

“This arrangement is key to our plan to limit the disruption to production levels as we transition to a fully operational new plant by the end of May 2021.  

“On the marketing front, we are pleased with the reintroduction of monthly local tenders with strong international participation and are encouraged with the achieved average price of US$423 per carat for the first two tenders of 2021.” 

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