Shore's Star diamonds twinkle at $135 (U.S.) per carat
Shore Gold Inc (TSX:SGF)
Shares Issued 69,295,912
Last Close 2/22/2005 $4.35
Wednesday February 23 2005 - News Release
Mr. Kenneth MacNeill reports
STAR DIAMOND VALUATION US$135 PER CARAT MODELED VALUE
Shore Gold Inc. advises that a modelled value of $135 (U.S.) per carat has been determined from the 3,050-carat parcel of diamonds recovered from the Star kimberlite. The modelled value was determined by WWW International Diamond Consultants Ltd., which, with its aboriginal partners ADG through Diamonds International Canada (Dican), are the valuators to the federal government of Canada for the Canadian diamond mines in the Northwest Territories.
The 3,050-carat diamond parcel was examined by four companies: R. Steinmetz and Sons N.V., WWW International Diamond Consultants, Rio Tinto Diamonds N.V. and BHP Billiton Diamonds (Belgium) N.V. Each of these companies has provided Shore with a detailed report on the valuation of the diamond parcel. The sample value of $110 (U.S.) per carat is the average of the valuations provided by the four companies and is based on the actual price that a producer will currently receive for this parcel in Antwerp.
The modelled value is determined using statistical methods to estimate the average value of diamonds that will be recovered from a future mine on the Star kimberlite based on the valuation of the 3,050-carat parcel at current diamond prices. The difference between the sample value and the modelled value results from undersampling of the top end (plus five carats) of the diamond size frequency distribution by the current bulk sample. The average modelled value of $135 (U.S.) lies between a minimum of $110 (U.S.) and a high of $162 (U.S.). WWW believes it is unlikely that the average price will be lower than $110 (U.S.) per carat based on current prices and that the high modelled value of $162 (U.S.) is reasonable considering the potential value of the larger diamonds in the Star kimberlite.
George Read, senior vice-president of exploration and professional geoscientist in the provinces of Saskatchewan and British Columbia, states: "Shore Gold is very pleased with this high modelled value of $135 (U.S.) per carat. Based on these results, it is expected that Shore will commence a prefeasibility study which aims to determine a mineral reserve for the Star kimberlite. The prefeasibility study will include underground drilling preceding the extraction of some 10,000 tonnes of kimberlite, core and large-diameter surface drilling, a desktop engineering study, and the commencement of an environmental baseline study. The company acknowledges the hard work of its employees, consultants and contractors that has led to this significant valuation number."
The diamond valuation procedure in both Saskatoon and Antwerp was supervised and monitored by Mr. Read and Kirsten Marcia, project geologist and professional geoscientist in the province of Saskatchewan |
