• Lucara Diamond closed a C$165 million ($121 million) equity financing to support the expansion of its Karowe diamond mine in Botswana.
• The underground expansion, now expected to start production in 2028, could extend Karowe’s mine life to 2038 with output estimated at 4.5 million carats.
• Lucara plans to secure additional funding through cash flow, equity, and debt, including a potential bond issue.

On Thursday, January 29, Canadian mining company Lucara Diamond announced the closing of a C$165 million ($121 million) financing round launched earlier this month. With this funding secured, the company now plans to mobilize additional capital to sustainably support the expansion of its Karowe diamond mine in Botswana.

“The company expects that the net proceeds of the private placement will be used to cover its liquidity shortfall in order to allow it to continue the development of the Karowe underground project while pursuing longer-term financing for the project, including shaft equipping, commissioning of the ore passes, lateral development, extraction and development of the drilling horizons,” the company said in a statement.

Now scheduled to enter production in 2028, compared with an initial target of 2026, the underground expansion is expected to extend the life of the Karowe mine until 2038. The project could deliver an estimated 4.5 million carats over the period.

Out of a total required investment of $779 million, the company said it has already committed more than $436 million over the past five years.

The newly raised funds should allow Lucara to continue operations at the Karowe site throughout 2026. The company plans to complete the remaining financing through a combination of cash flow, additional equity raises, and new borrowing. These options include a potential bond issuance that the company is currently assessing.

To execute this strategy, Lucara appointed investment banks Clarksons Securities AS and Pareto Securities AB as financial advisers.

These efforts come as the project faces persistent implementation challenges. The development is unfolding amid a weak natural diamond market marked by soft demand and low prices. In a report published in November 2025, Lucara warned that its cash position and resources might not be sufficient to meet all its financial obligations in the coming months.

For reference, the government in Gaborone receives a 10% royalty on revenues from Karowe, in addition to taxes and other fiscal revenues collected from Lucara.

This article was initially published in French by Aurel Sèdjro Houenou

Adapted in English by Ange J.A de BERRY QUENUM