Brazilian Diamonds Ltd.: Santo Antonio Project Update INCRIS Acquisition Adds to Santo Antonio Portfolio
Tuesday April 27, 8:59 am ET
VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Apr 27, 2004) - Brazilian Diamonds Ltd.'s Joint Venture on the Santo Antonio do Bonito alluvial diamond property has commenced activity on the CDN$800,000 feasibility study intended to facilitate a final decision on the commencement of large-scale alluvial mining operations (See February 11, 2004 press release for details).
The feasibility study will involve an additional 3,000 m of large diameter Banka drilling, and up to 6 bulk sample test pits. The work is being conducted and paid for by COMIG (Companhia Mineradora de Minas Gerais), with the assistance of both Mineracao Rio Novo (MRN) and Brazilian Diamonds.
The commencement of the feasibility study follows 2 years of due diligence work already undertaken on the project by the Company's Joint Venture Partners.
Following successful completion of the feasibility study, MRN intends to move its alluvial mining equipment (including an 8 story high - 2,000 tonne per day bucket wheel dredge, and suction mining dredges) from their current operation at the Domingas alluvial diamond mine to the Santo Antonio property. MRN's Domingas mine has produced approximately 25,000 carats per year for more than 15 years, and now has an estimated mine life of approximately 2 years.
Brazilian Diamonds Ltd.'s Santo Antonio do Bonito property covers the drainage of the Santo Antonio do Bonito River which is famous in Brazil for producing very large gem quality diamonds, including at least 9 stones of between 300 and 727 carats. These large gems, and many other alluvial diamonds, have been produced by artisanal miners (garimpeiros) working on channel and terrace gravels upstream in the river drainage. The Joint Venture is targeting extensive volumes of alluvial gravels in river flats downstream from this historic garimpeiro activity. These gravels have been considered to be too deeply buried for garimpeiros to access, but within reach of MRN's large scale alluvial mining equipment.
Brazilian Diamonds own exploration efforts remain focused on the discovery of the bedrock sources of diamonds in the Santo Antonio do Bonito River valley and elsewhere in Brazil. The Company's most advanced project is trial mining of the diamondiferous Canastra 1 kimberlite. Licensing for the Canastra 1 operation is progressing slightly more slowly than originally foreseen, with operations now expected to begin in the fourth quarter of this year.
As part of Brazilian Diamond's strategy of exploring for bedrock diamonds sources in the Santo Antonio do Bonito River valley, the company is pleased to announce that it has completed the acquisition of a portfolio of 13 licences held by INCRIS Mineracao Ltda. These licences cover an area of approximately 18,000 hectares of the River's headwaters and adjacent plateaus and are thought to include numerous kimberlitic anomalies which will be tested at the Company's Patos de Minas mineral processing laboratory. This acquisition will also permit an aggressive follow-up of the alluvial sampling and intrusive body testing program already underway in the valley.
Under the terms of this transaction, Brazilian Diamonds will pay INCRIS US$8,000 for the transfer of these the licences to SAMSUL Mineracao Ltda, a wholly owned subsidiary. Brazilian Diamonds has already taken over management of re-licensing of the portfolio and will assume the cost of paying INCRIS' outstanding licence fees which are estimated at approximately US$15,000. INCRIS will also retain a 1% gross royalty over any kimberlites developed as mines on licences in the portfolio. |
