BHP Billiton: Ekati Production -29% in Q2

(IDEX Online News) – BHP Billiton's Ekati diamond mine produced 481,000 carats in the past quarter, a 29 percent year-over-year decline. The decline in production is a result of a slowdown in extraction in the December quarter.

Production at Ekati is expected to remain "constrained" in the medium term BHP Billiton reported in a quarterly operations review, as the operations extract lower grade ore.

In the first six months of the fiscal year, Ekati produced 938,000 carats, a 32 percent decline from the 1.4 million carats mined in the first half of the prior year.

According to the report, the company processed 2.27 million tones of ore in the first half of the year, yielding 0.41 carats per tonne, this compared to 0.59 cpt in the prior year.

The quarterly production result is an improvement compared to the September-ending quarter, when the company mined 457,000 carats.

During the quarter, BHP Billiton announced a review of its diamonds business, including the Group’s interests in the Ekati diamond mine. The company said the process is ongoing and could continue through the first half of the 2012 calendar year.

The continued slowdown at Ekati, source of about 10 percent of the global rough diamond supply by value, means that rough will be less accessible in the near-term causing shortages in the market.