Lucara Diamond Corp. is pleased to provide operating guidance for 2024 (all amounts in USD unless otherwise stated).

2024 Outlook

This section provides management's production and cost estimates for 2024. These are "forward-looking statements" and subject to the cautionary note regarding the risks associated with forward-looking statements.

Revenue And Sales Channels

In 2024, the Company's revenue forecast assumes that 87% of the carats recovered will come from the higher value M/PK(S) and EM/PK(S) units within the South Lobe and the remaining carats recovered will come from the Centre Lobe in accordance with the mine plan, generating revenue between $220 and $250 million. South Lobe material, while lower grade than the Centre and North Lobes, has a higher weight percentage of stones greater than 10.8 carats in size ("Specials").  

The Company plans to use its sales channels to maximize revenue and generate consistent cash flow to support the Company's operations and its investment in the underground expansion project. The Company expects to seek opportunities to sell its higher value Specials through agreements whereby the rough stones are manufactured, giving the Company exposure to polished prices and regular cash flow from the highest value portion of the Karowe production. Quarterly tenders and regular sales through Clara, primarily for stones smaller than 10.8 carats in size will continue.

On November 10, 2023, Lucara announced a reduction in expected annual revenue guidance for fiscal 2023 due to changes to the sales mechanism for rough diamonds larger than 10.8 carats in size following termination of the Company's diamond sales agreement with HB in September 2023. The Company expects to monetize the +10.8 carat stones currently held in inventory in 2024. The revenue forecast for 2024 does not include amounts related to the inventory.

Mining And Processing Assumptions

In 2024, the Company expects to mine between 3.6 and 4.6 million tonnes, of which ore tonnes mined represent approximately three quarters of total tonnes mined. The assumptions for carats recovered and sold as well as the number of ore tonnes processed are consistent with achieved plant performance in recent years. A portion of the  tonnes mined in 2024 will be stockpiled, prior to the end of open pit mining in mid-2025. Stockpiled material is planned to be processed between 2025 to 2027 before the mine transitions to underground operations. Ore from the underground development is expected to supplement lower grade stockpile material, primarily from the upper benches of the South lobe, during the transition to underground, beginning in 2027.

Underground And Sustaining Capital Expenditures

In 2024, capital costs for the underground expansion ("UGP") are expected to be up to $100 million and will focus predominantly on shaft sinking activities and station development. Surface works will focus on completing the construction of the bulk air cooler and installation of the cage winder. Tendering the underground development contract along with underground equipment purchases are also included in the 2024 project plan.

The underground expansion is expected to extend Karowe's mine life to at least 2040 and is forecast to contribute approximately $4 billion in additional revenues using conservative diamond price assumptions which are un-escalated and exclude revenues from stones sold in excess of $10 million. On July 16, 2023, an update to the Karowe UGP schedule and budget was announced (Press Release). The Company notified its Lenders of the expected increases to both the schedule duration and the projected cost to complete the Karowe UGP and is working closely with its Lenders to agree amendments to its project facilities of $220 million. As part of the ongoing amendments, the Lenders have granted certain waivers and extensions to the Company.

Sustaining capital and project expenditures are expected to be up to $10 million with a focus on replacement and refurbishment of key asset components in addition to dewatering activities, and an expansion of the tailings storage facility in accordance with Global Industry Standard on Tailings Management.  

Corporate Update

Lucara is pleased to announce that Glenn Kondo will be rejoining the Company as its Chief Financial Officer and Corporate Secretary effective January 1, 2024. His previous roles and diamond industry knowledge will contribute significantly to Lucara's strategic financial planning and overall corporate success. Glenn will bring valuable experience and expertise to the Company's financial leadership.

William Lamb, President and CEO commented :

We are very pleased to welcome Glenn back to Lucara. His previous experience at Lucara will be instrumental in delivering on the key financial fundamentals which drive shareholder returns."
‍On behalf of the Board,
‍William Lamb
President and Chief Executive Officer

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About Lucara
‍Lucara is a leading independent producer of large exceptional quality Type IIa diamonds from its 100% owned Karowe Diamond Mine in Botswana. The Karowe Mine has been in production since 2012 and is the focus of the Company's operations and development activities. Clara Diamond Solutions Limited Partnership ("Clara"), a wholly-owned subsidiary of Lucara, has developed a secure, digital sales platform that uses proprietary analytics together with cloud and blockchain technologies to modernize the existing diamond supply chain, driving efficiencies, unlocking value and ensuring diamond provenance from mine to finger.  Lucara has an experienced board and management team with extensive diamond development and operations expertise.  Lucara and its subsidiaries operate transparently and in accordance with international best practices in the areas of sustainability, health and safety, environment, and community relations.  Lucara has adopted the IFC Performance Standards and the World Bank Group's Environmental, Health and Safety Guidelines for Mining (2007).  Accordingly, the development of the Karowe underground expansion project ("UGP") adheres to the Equator Principles. Lucara is committed to upholding high standards while striving to deliver long-term economic benefits to Botswana and the communities in which the Company operates.

The information is information that Lucara is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. This information was submitted for publication, through the agency of the contact person set out above, on November 28, 2023 at 5:00pm Pacific Time.