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[Audio Gap] from 0.65 to 0.31 and the total number of injuries, including LTIs, down 38% to 8. As we have disclosed before, the majority of LTIs experienced recently have been of low severity and behavioral in nature. This seems to be mirroring a wider trend in South Africa, where safety performance has deteriorated during the COVID-19 pandemic, which is attributed to the consequent disruption to people's lives and working environments. Our focus has, therefore, been on behavior-based intervention programs, and it is encouraging to see the improvement in this area.In terms of production, we saw an 8% uplift from the preceding quarter to just under 862,000 carats further to the steps taken to address the impact of waste ingress at the Finsch mine. Year-on-year production was down 12%, which is largely attributable to Finsch's high level of production before the impact of the waste ingress and the results in planned decrease in throughput and grade to mitigate its impact from quarter 2 of financial year 2021. Production at the Cullinan mine has continued to be strong, but we have reported that the most eastern tunnel in the C-Cut block cave, known as Tunnel 41, experienced a sudden and rapid onset of convergence, which required immediate attention. This resulted in the installation of additional support to protect the tunnel for the longer term and the closure of the southern access to Tunnel 41. This, together with the previously reported closure of the northern access to the tunnel, has resulted in 18 draw points established in this tunnel out of a total of 187 across the entire C-Cut not being accessible for the remainder of this financial year 2022.We are currently investigating the root cause of this convergence as well as evaluating appropriate mitigating actions. Early indications are that without any mitigation, the convergence could result in a reduction of around 75,000 to 100,000 carats in Cullinan's production for this financial year 2022, which is now expected to be at the lower end of our earlier guidance of 1.7 million to 1.9 million carats, again emphasizing that this is if no mitigating steps are taken and included.Group production guidance for financial year 2022 remains unchanged at 3.3 million to 3.6 million carats, including Williamson, with the South African operations estimated to contribute 3.1 million to 3.4 million carats. The reengineering project at Finsch and Koffiefontein that we initiated in July of this year to comprehensively review and improve the mines' cost basis and enhance operating margins remain in progress, and we will be in a position to provide more information on these projects at the time of our interim results in February next year. The production ramp-up at Williamson commenced during quarter 1 with 360,000 run-of-mine tonnes processed, yielding 14,400 carats. Turning now to diamond market and sales. In terms of our sales, we experienced a very strong quarter, noting that we only hosted on sales tender in quarter 1 as we normally do as opposed to 2 tenders in the other quarters. Quarter 1 financial year 2022 revenue increased by 48% to just under $115 million driven by the sale of Exceptional Stones, which contributed $50.2 million and included the sale of the 39.3 carat type IIb blue diamond for just over $40 million, and the 342.9 carat type IIa white diamond, which sold for $10 million. Just as a reminder, we classify exceptional stones as any rough diamonds that sell for more than $5 million each.Revenue for the quarter from our first tender of this financial year was supported by diamond prices that increased by some 3% on a like-for-like basis compared to those achieved in quarter 4 of financial year 2021.We, like other commentators, continue to see a supportive market due to the recent significant structural tightening of supply. In 2020, the market experienced one of the most severe contractions in supply on record, falling 22% in carat terms to 107 million carats from 138 million carats the year before. This is due to the combination of temporary shutdowns following COVID-19, diminishing resources and the closure of the Argyle mine in Australia.Limited exploration and new projects suggest the continuation of the step down in supply, at least in the medium term. This contraction in supply has come about as the retail market for diamonds has rebounded well with the economy starting to open up and normalize after the lifting of some of the restrictions associated with the pandemic, with demand notably strong in the U.S. and China. This has served to significantly clear out excess inventories in the midstream and provides a much better balance between supply and demand. The Natural Diamond Council continues to play its part and has recently launched its new advertising campaign and that's stimulating demand in the run-up to the important festive buying season. We are now in the final stretch of Project 2022, our 3-year business improvement program. The primary objective of this project was to deliver significant free cash flow predominantly by improving throughput at the operations as well as to embed a culture of operational and capital efficiency within the business. As detailed in our recent preliminary results announcement, annualized operating cash flow benefits of around $70 million are expected to be delivered through these Project 2022 initiatives and are expected to result in the group meeting its target of $100 million to $150 million of net free cash flow by the end of June 2022.I will now hand over to Jacques to cover the financial highlights before providing an update on the Williamson mine. Thank you.
Thank you, Richard, and good morning, everyone. As noted in the announcement, consolidated net debt reduced further to $207.6 million at the end of September, down from $228 million at 30 June of this year. The company currently has unrestricted cash of just under $204 million and diamond inventories of $76 million, up from $45 million at 30 June, in line with expectations given the timing of our first tender for fiscal year 2022.With regards to CapEx, we have reiterated our guidance for the full year to remain at $70 million to $82 million, excluding Williamson with the majority of this being assigned to Cullinan and Finsch. CapEx spend is expected to be weighted towards our second half of financial year 2022.We have also announced that we have commenced discussions with our South African lender group around the possible refinancing of the company's first lien debt, and we hope to conclude these discussions by the end of the calendar year. I will now pass back to Richard to give an update on Williamson.
Thanks very much, Jacques. So just on Williamson, I wanted to just run through an update of the steps we are taking at Williamson, in particular, to address the allegations around human rights abuses as well as the continued issue of illegal mining incursions onto Williamson's mine lease area.As we previously announced, Petra and Williamson Diamonds Limited, the operator of the mine, have taken extensive action to address this area of human rights allegations since these came to light. And there's a detailed update included on our website, and there is a link at the bottom of the section in the announcement for those of you who would like to take a look. One of the measures taken was the establishment of a Tier 1 operational grievance mechanism for complaints and grievances that relate to the day-to-day operational activities. Having established this OGM, the company has continued during this quarter with the process of designing and implementing a nonjudicial Tier 2 independent grievance mechanism, which will consider any incidents of potential human rights violations and will provide remedy as necessary.Putting this IGM in place requires multi-stakeholder engagement and approval, including from the government. We are, therefore, targeting the launch of the pilot phase of the IGM by the end of financial year 2022 with the IGM becoming fully operational by the end of quarter 1 financial year 2023.Community members are already able to lodge grievances intended to be handled via the IGM, and the number of such grievances have been lodged to date, which will be evaluated in due course once the IGM is up and running. We have also made progress with the various community projects around sustainable development, and an update on these is also available on our website.On illegal mining, during the first quarter of this financial year 2022, there were a total of 143 reported incidents of illegal incursions onto the Williamson mine lease area, resulting in 6 security officials and 2 police officials suffering minor injuries and 15 arrests being made. We believe the contracted security teams in Tanzania and police acted in accordance with the voluntary principles on security and human rights.WDL is continuing its extensive engagement with communities around the mine to highlight the dangers of illegal mining seeking to reduce these illegal incursions going forward. As previously mentioned, Williamson is classified as an asset held for sale, while we review strategic options for the mine, but this does not impact our commitment to the actions and projects implemented in response to the human rights abuse allegations. That concludes the overview of this trading update, and we will now open up for questions. As a reminder, please raise the hand icon if you would like to ask a question and we will then take you off mute. Thank you.
Richard, we have taken your mute off, you should be able to unmute.
You hear me okay?
Yes.
And congrats on a good operational sort of performance, particularly at Finsch's. Nice to see it kind of coming back on to a better run rate. But I suppose this morning's focus is going to have to be Cullinan. So can you perhaps give us some guidance as to the impact that this is going to have on grades? I think by my memory, that eastern part of the C-Cut is the high-grade part of it. So what's the impact potentially on grade and throughput?And -- I mean as much as you know, at this point in time, what is the potential impact on your ability to draw that portion of the cave? Is there any concern it's going to have any impact on the reserve of the mine or anything at this point? That's the first one.
Thanks, Richard. Richard, yes, just on that convergence and just to note your first point around grade, just a reminder that the difference in grade that we speak to at Cullinan is more particularly around the western side which is the entire C-Cut, which includes this Tunnel 41 and the eastern side where we refer to CC1 East. We're currently not producing from CC1 East because we're busy with developing below the current levels of CC1 East. So typically, the eastern side of the mine is higher grade than the Western side, which is where the C-Cut is. So there's no particular difference in grade between the tunnels in the C-Cut on the -- towards the eastern side of the C-Cut. So the first -- to your first question, Richard, is we don't expect there to be any impact on grade as a result of the convergence. So just talking to that and reminding people that we had always experienced and knew that we would likely see convergence in the northeastern side of the C-Cut, so if you like, on the northern end of that Tunnel 41. And we previously have discussed measures taken to plug some of those draw points to provide some stability and look at going in later.So in this case, we -- as soon as we noted the convergence in that Tunnel 41, we took steps to try and secure that. The difference here is there was quite a large wedge that informed above draw point 81, and so we needed to bring that down safely, and it did result in a void being created, which we're busy rehabilitating currently. So the -- we're still doing the root cause analysis to formally determine the cause, but it really is a combination of ground conditions and in that part of the mine, there are a number of structures and faults that we're aware of. We're also in some of the weaker grade kimberlite areas. And so there are instances where there's oversized material that results in hang-ups in draw points. And so really, the steps we're taking now are to ensure that we're able to get back into that area later. We cannot, at this stage, give a clear indication of when that would be. So we have indicated that we don't expect to be back in Tunnel 41 for the remainder of this financial year. But as we complete the work and get the various rehabilitation work done, we'll be able to update you on that.And that's why we've said for this year, we expect there to be the impact as we've indicated. It is important to note that we haven't yet incorporated any mitigating steps. So we are currently, for example, processing tailings, and we will look at whether we can process some additional tailings to mitigate the impact of Tunnel 41 not being available at the moment. And so it clearly is a setback, but it's manageable. The team is on top of things. We've seen stabilization through the measures taken to date, and we've kind of got a program through supporting this and plugging certain sections of the tunnel that would allow us to come back later on once it is stable and then look at extracting that ore. So certainly, we're not talking about reducing reserves. It's really just a case of ensuring that we can properly stabilize that area, and it makes sense to leave that for a while once the plugging and the support has been installed, and then we will obviously monitor that on an ongoing basis. And we'll also come back and talk to any of the mitigation actions that we will be taking at our next call.
Can I just ask one more? Is that possible? Just on the -- as we look kind of further ahead, do you think that as you move further east into the orebody that, that will require kind of additional support in the longer-term mine development plan? And just, Jacques, is there any kind of steer on what the impact could be on a cost perspective? I guess if we're guiding to the lower end of production guidance, we'll guide to the upper end of cost?
Richard, it's too soon to be able to talk to that. You're really talking about what we call the sort of center cut. It's the area between the C-Cut block cave and CC1 East. It is an area that we are looking to potentially exploit. Remember, it's not in our current life-of-mine plan. And so we are looking at opportunities to potentially consider putting a tunnel or 2 in on the eastern side of Tunnel 41 to see what the opportunities are there. But certainly, you may recall that the area at the upper levels wasn't exploited by De Beers in the earlier days because there was a fair bit of internal waste in what was called, I think, the AUC. However, our geologists have indicated that, that internal waste produces at depth. And so it certainly is an area of interest, but just to highlight, it's not in the current life-of-mine plan. It is going to be looked at, and it may be sensible put a few tunnels in to get more information. But we certainly are not in a position to talk about additional support or additional costs at this stage. There's no particular reason to think there would be a need for that, but it's premature to have that discussion yet, Richard.
[Operator Instructions]
Also just to note, and I should have said you can also -- if easier type any questions you have using the chat feature, if you're not able to raise your hand, and that will appear on our screen, and we'll read out the question and answer it. So either raise your hand on the icon or type a question using the chat feature, and we'll answer those questions.We'll pause for a while to see if there are any other additional questions. I see we have Richard coming back for a second run. Richard, go for it. Richard, are you -- we just need to unmute. Just give us a second.
Yes. Cool. Sorry, take my chances when I get them. The tailings grade for Q1 was a lot better than I think what we were looking for at Cullinan. And just can you -- just talk to us about that. I know it's quite variable, but is there any kind of guidance you can give us on the Cullinan's tailing grade? And I mean that's just to focus on a positive, the ROM throughput on Finsch was really very good. So can you perhaps just give us a little bit more of -- a tad more on what you've been doing at that mine? And how comfortable you are that you can keep that running at these levels? Sorry, and the other one was just on the Cullinan and ROM grades. That was a bit light versus your guidance versus last quarter. Was there anything going on there?
So let's talk grade first, tailings and ROM at Cullinan. I think what we've indicated is the grade isn't linear. We have times where we have slightly higher and slightly lower grades. So there's nothing in particular on either of those. We've had slightly better grade on the tails and slightly lower grade on the run of mine, but there's certainly no cause for concern on the lower ROM grade. And the tailings, we don't have precise information on the grade. So we happen to be benefiting from a slightly higher grade, which, I guess, is quite good given the slightly lower ROM grade. But no, it's all -- it all is aligned and in line with the plan. On Finsch, I think we need a little bit of time to properly understand the waste ingress, I think we understand it now. We know how to manage and ensure that we adhere to draw compliance around the mitigation steps that have been taken. So I think with Finsch, the performance in quarter 1 was in line with plan, and there's no reason not to think that we would continue to deliver to that plan.So we kind of through the incremental cycle of looking at volume and grade and getting that right. And I think we've got that right at Finsch now. And really, it's about ensuring that we continue to mine to plan, adhere to our -- and manage our draw compliance, and we should continue to see Finsch performing at these levels.
There's another question from [ Ross Carden ].
Just a question for you on the balance sheet. How do you think about sort of the cash balance that you want to run? Obviously, you've been performing pretty well. Cash has grown. I was just thinking about whether it's paying down of certain facilities, refinancing opportunities as the credit starts like better, how are you thinking about that? And what opportunities do you see?
Thanks, [ Ross ]. Jacques here. So on the cash balances, as we indicated, we have started discussions with our first lien lenders. We are looking forward to refinancing those facilities, which should see us utilizing up to $100 million to settle the drawn facilities there. I think at the end of September, given the exchange rate, it was around $90 million drawn on those facilities. So a portion of the cash will be directed towards those facilities, most likely. And once we have new facilities in place or refinanced, we'll advise accordingly. But that's the initial target for cash is to be directed to those.
Okay. And how low -- like what's the minimum cash balance that you're comfortable running in the business?
[ Ross ], I think I'd rather answer in minimum or around the level of available cash and facilities would be around $150 million mark, maybe a tad less. But 3 to 4 months' worth of working capital on our expenses should -- so far given our trading and tender timing. So the 3 to 4 months' worth of expense, CapEx and OpEx, which adds up to somewhere between $120 million and $150 million.
Got it. Okay. And just a question on what's happened at Cullinan, and forgive me because I'm not a mining guy, but what -- in layman's terms, can you just describe what's actually happened? And then I think in the last question answer, you were saying something about it not being in the mine plan. Just want to clarify the area that you're in, was that part of the tech report in the sort of official mine plan? Or I just wanted to clarify that point as well.
Thanks. So [ Ross ], Cullinan is currently mined through a block cave, which is the C-Cut and the Tunnel 41 we're talking about is at the east end, the far eastern end of that C-Cut block cave. So it is very much part of the life-of-mine plan. Then there's a section in the middle which we call the center cut, which is not in the current mine plan. And then to the east of that, we have an area we call CC1 East, which we have been exporting as a sublevel cave, but we're not currently producing from CC1 East because we're busy developing the levels below the last mining area. So that's a project that is currently under development, and we'll get back into the CC1 East area once that project is completed and the new sublevel caves have been installed. So in layman's terms, you have these tunnels. And if you want to have a look and you go and look at our website, you'll see some schematics in previous trading updates and presentations that would show that. But essentially, you have a number of tunnels that run across the footprint of the C-Cut. And those tunnels then have a number of drawbells that have one or more draw points coming off them, and those are really vertical draw points that receive the broken ore following a series of drilling and blasting above the bottom or the mouth of the draw point.And the area we're in because of ground conditions and other factors, we saw a large rock wedge that hung up above one of the tunnels. It was -- sorry, one of the draw points, draw point 81, and we needed to take that down safely, and it resulted in a large void and part of the tunnel because of the different stresses also started to converge. So in order to ensure that we don't see uncontrolled convergence or voids forming, we took steps to put the steel sets in to hold up the tunnel, and we also took measures to plug with concrete, some of the draw points. And we have a plan to continue to support and rehabilitate the tunnel. But the consequence of that is that to allow it to properly stabilize, we're not going to access that tunnel. And that tunnel as we mentioned in my update around the operations, it's about 18 tunnels out of the total...
18 draw points.
18 -- sorry, 18 draw points out of the total 187 draw points across the mine. So it means we won't be drawing ore from that particular area. We will continue drawing from the rest of the mine. And what I said is we haven't yet considered alternative sources of material, which would include tailings, for example. My comment to Richard was that center cut is an opportunity that we certainly are considering as part of life extension beyond the current mine life, and it may make sense for us to put some tunnels in to get more information on that part of the ore body, but it does not currently feature in our life of mine plan. So hopefully, that helps.
Next question, Ian Rossouw. [ Ross ], I assume we've handled your question here. I'm jumping to Ian Rossouw. Ian, you should be able to unmute. Ian, we seem to have the same issue we had last time, if I recall correctly, where we, for some reason, can't hear you. We do see your hand up.
And we have unmuted you on this side. Ian, we can't hear you. I don't know if you're able to use the chat feature and type your question.
Richard Hatch, we'll jump back to you. You should be able to unmute now, Richard.
Yes. A point of clarification. Is the -- the expectation is that you will, at some point, be able to return back into this tunnel, right? Whether it be fiscal '23 or fiscal '24, the hope or expectation is that you will get back into it?
Yes, indeed.
Okay. And just to be -- another point, are you experiencing any other kind of sort of unexpected or weaker than expected ground conditions to the western areas of that eastern tunnel. So the tunnel to the immediate west of it. Are you seeing any kind of deterioration of ground conditions there as you mine? Or is that kind of in line with expectations?
That's in line with expectations.
Should we see if Ian has been able to rapidly type a question?
Just working -- Ian's question is on the Cullinan. On Cullinan, should we assume for time being that, that replicates the number than previous plan for the moment? Or will you have some feasibility to increase tonnages from the remaining draw points?
Thanks, Ian. So first of all, just to note that if we did nothing and didn't mitigate anything, the impact would be more like 8% or less, not 10%. And in terms of mitigating opportunities, we're unlikely to pull any existing draw points harder. I think it's important to manage and run the mine according to the mine plan. So we do have draw profiles. We have to also rehabilitate draw points to ensure that they continue to perform optimally.So short answer is we're unlikely to go and draw harder in the remaining part of the C-Cut. That could be a short-term option, but it's not a sensible medium- to longer-term option. So we're not looking at that. What we are looking at is to increase the tailings material. So we do have the opportunity to do that. And there are some medium-term opportunities that we are considering as well, and we'll come back and talk to those once we've been able to work those options up a bit. Remembering that this happened quite recently, it was only in September, and so it's still relatively early days on the remediation.
Thanks, Richard. I'm also reading a follow-up question from Ian. On Finsch, your comments about Q1 throughput being a sustainable level. And grade should we take this level in Q1 as a representative figure for the next couple of years, i.e., around 2.8 million tonnes per annum. Just putting it into context that your previous comments at 2.83 million is achievable for the medium term. And as a reminder, our guidance for this year was 2.75 million to 2.85 million tonnes.
So Ian short answer, happy with the guidance. I think that we haven't gone out with guidance beyond this year. I know that's frustrating most of you, all of you, we will have a Capital Markets Day early next year in our Q1, and we will go through the sort of detail over a more helpful period of time. So I would suggest we do that then. But I think that we would see Finsch at that level and possibly a little better going forward. But let's wait for our Capital Markets Day, and we can go through that in a little more detail than we're able to now.
Just to confirm on the Capital Markets Day Q1, which Richard referred to is for calendar year.
Sorry, calendar year Q1, yes.
Calendar year quarter Q1. So quarter ending March, sometime during that quarter. Richard, that seems to be the last question.
Right. We don't appear to have any more questions. So thank you very much to all of you for your participation. Obviously, if you do have any follow-up questions, you know how to get hold of our team, and we'd be happy to answer them. But thanks again, and look forward to chatting to you again in the near future.
Thank you all. Bye-bye.