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***News Release***
SOUTHERNERA RESOURCES LIMITED - ANGOLA OPERATIONS
- 106 Carat Gem Stone Recovered at Luo
- First 1998 Angola Diamond Sales, Luo Concession
- Camafuca Kimberlite Drill Program Begins
- Sales Results
TORONTO, Feb. 20 /CNW/ - SouthernEra Resources Ltd., (TSE-SUF) is pleased
to report the results of the first 1998 sale of diamonds from the Luo
Concession in Lunda Norte Province, Angola.
Earlier this month 5758.4 carats were sold for gross proceeds of US
$870,554. The parcel value averaged US $151.18 per carat. Net proceeds to
SouthernEra, after disbursements to its partners, and sales and valuation
charges total US $471,415,00. This sum represents the Company's profit share
and reimbursement for recent capital improvements at the site.
The production represents diamonds recovered from riverbed and floodplain
gravels in the fourth quarter of 1997, (press release Dec. 22 1997), and
during 12 days in January 1998. Stone sizes from the floodplain and riverbed
gravels average approximately 0.31 carats and 0.75 carats in weight,
respectively. Cumulative sales to date, including 1997 production, now amount
to 24,748 carats with an average value of US $308.30 per carat.
106 Carat Stone Recovered
A 106 carat gem diamond, was recovered yesterday at the Luo river
diversion operation. The stone is described as clear and colourless, with no
apparent internal flaws. No valuation has as yet been done on this diamond.
Operations are continuing in this section of the channel.
Present Luo Activities
Production continues from both the flood plain gravels and the riverbed
deposits utilizing the rotary pan plant. So far this year production has
averaged approximately 265 cubic metres per operating day, with daily
recoveries varying from 100-190 carats, averaging about 150 carats per day.
The material currently being processed represents gravels from the riverbed,
and stockpiled floodplain material mined late in 1997.
Grades for the river and floodplain gravels average approximately 3.15
and 0.31 carats per cubic metre, respectively.
A second pan plant is now being prepared to increase the production rate
on the site, and is expected to be operational in late March. This will
increase throughput to approximately twice the current rate.
A new diversion canal is also being excavated to prepare a further 2.5km
length of riverbed for mining. This area contains several potential trap sites
where high grade ''potholes'' and scour channels similar to those found in
other parts of the river are likely to occur. Additional flood plain gravels
will also be available for mining once this new diversion is completed. Plant
feed material should be available from this new diversion area in early May.
Camafuca Kimberlite Drilling
Elsewhere in Angola, a large diameter core drilling program is underway
to begin testing the large Camafuca kimberlite pipe (51% SouthernEra) near
Calonda in Lunda Norte Province.
The first phase work will consist of drilling a series of holes on the
east side of the pipe where previous work by DIAMANG identified an area of
higher grade kimberlite material. Core from this area will be tested to
compare results to the earlier data, and identify zones for bulk sampling
later this year.
Future Plans
SouthernEra and its partners are pleased with the ongoing progress and
production activities at Luo. The recovery of large stones from the present
diversion area, consistent daily recoveries, and planned increased production
capacity will all serve to provide ongoing cash flow from this operation. This
should result in successfully reaching, or exceeding, the targeted production
objectives of 3000 carats per month in the current year.
The opening of the new diversion canal and production from the new river
channel area will provide additional opportunities for the recovery of large
high quality diamonds.
SouthernEra's operating agreement at Luo provides for 10% interest in the
fluvial (riverbed) deposits, and a 35% interest in the floodplain gravels.
It has recently negotiated an agreement in principle with its South
African partners whereby the Company has assumed responsibility for the Luo
operation, with its current interests being replaced by a 30% interest in the
production from both types of deposits.
The evaluation program at Camafuca will continue and preliminary results
will be reported when available.
To those who recently asked me questions yet unanswered, I apologize but I have been buried lately.
I will attempt to get back as soon as I can.
Regards |
