Lucara Diamond Secures $350 Million Bond to Complete Botswana Underground Mine

The 302.37-carat emerald cut that Graff unveiled after purchasing the 1,111-carat Lesedi La Rona for $53 million. The 1,758-carat Sewelo, acquired by Louis Vuitton. The 2,492-carat Motswedi, now ranked the second-largest diamond ever found. All of them came from the same patch of Botswana kimberlite, and last week a $350 million bond secured the future of the mine that produces them.

Lucara Diamond Corp. closed the senior secured bond placement on March 30, 2026, funding the final stretch of the Karowe Underground Project. The bonds carry a fixed coupon of 12.5% annually, paid quarterly, over a five-year term. Net proceeds will fully repay the company's existing $220 million in project debt, cover roughly two years of interest payments, and fund remaining construction costs.

The Karowe mine, whose name means "precious stone" in Tswana, holds a record that defies probability: eight of the 10 largest rough diamonds ever found have come from this single Botswana operation. Commissioned in 2012, it is among the world's foremost producers of Type IIA diamonds, a chemically pure category that commands the highest prices at auction and yields stones suited to the grand emerald-cut and cushion-cut treatments now dominating high-jewelry commissions.

Completing the underground expansion is critical to preserving that supply. Open-pit operations are expected to cease in the first half of 2026 before underground mining begins, now targeted for the first half of 2028, roughly 18 months behind schedule due to geotechnical challenges and supply-chain pressures. A key milestone came in July 2025 when the production shaft reached its final depth of more than 720 meters below surface. The total estimated project cost has grown to $779.2 million, up from the original May 2022 estimate of $547 million.

The bond is the second leg of a two-part capital raise. Lucara completed a C$165 million equity offering in January 2026; together, both raises provide sufficient capital to see the underground project through to completion. The bond also includes an option to draw a further $50 million, plus an optional $50 million revolving credit facility, giving Lucara meaningful liquidity headroom during the transition between open-pit closure and underground production.

President and CEO William Lamb, who originally commissioned Karowe during his first tenure as CEO from 2013 to 2018 and returned in August 2023, called the financing "a pivotal milestone for Lucara, significantly strengthening our balance sheet and providing the financial certainty required to advance the UGP through to completion."

Once underground production begins, Karowe is forecast to recover 4.5 million carats over a 10-year mine life, extending operations to at least 2040. The project carries an after-tax net present value of $432 million and is projected to generate more than $1.3 billion in net income and roughly $4 billion in additional revenues. Initial production will focus on the EM/PK(S) geological unit, historically the highest-value zone and the source of several of the mine's largest recorded stones.

Lucara sells all diamonds weighing 10.8 carats and above through a multi-year agreement with HB Antwerp, a Belgian manufacturer that pays an additional share of polished profits. In Q2 2025, that partnership generated $34 million, or 78% of Lucara's total quarterly revenue. Full-year 2025 revenue fell to approximately $159.7 million, down from $203.9 million in 2024, partly because fewer exceptional stones were recovered that year.

The 18-month production gap will be closely watched by high-jewelry ateliers. Designers commissioning large-carat center stones in 2027 and 2028 may find fewer options at the top of the size spectrum; once the EM/PK(S) unit begins delivering, the decade ahead could produce another generation of named stones that redefine the upper limits of fine jewelry.