SouthernEra Diamonds Q1 Net Loss Narrows

Canadian diamond miner SouthernEra Diamonds reported its overall losses in the first quarter from mining operations were $0.2 million compared with a loss in the same quarter of 2004 of $0.5 million.

SouthernEra said its 56-percent owned Klipspringer Diamond Mine continued on care and maintenance in the first quarter of 2005 and thus the firm recognized no diamond sales in the quarter. In the comparable quarter of 2004, the recovery from production was nominal.

Mine maintenance costs at Klipspringer in the first quarter of 2005 of $0.2 million were offset by sales of scrap materials, down from $0.6 million in the first quarter of 2004.

SouthernEra is studying alternative mining methods and optimal levels of production at Klipspringer with the intention of resuming mining operations in the near term. Start up costs in each of the alternatives being studied are not expected to be significant.

Cash inflow from operating activities in the first quarter of 2005 amounted to $0.9 million versus cash outflows of continued diamond operations of $3.0 million in the first quarter of 2004.

SouthernEra Diamonds is involved in diamond exploration in Canada, Australia, Gabon, the DRC and South Africa.