Yes, there's at least two of us. I've posted the last two news
releases below. The most recent developments concern the aquisition of
options to purchase a mine in South Africa and a pipe in Lesotho. I'd
like to hear some more details about these properties, but I find it
encouraging that they are thinking about spreading out into more
stable countries than Angola and Sierra Leone. I guess we should be
hearing something soon about the sale of the last parcel of diamonds
(15000 ct). After that, the 2nd alluvial mine in Angola is scheduled
to be completed in June.
I'm relatively new to DMW. It looks to me like it should be a good
year - with the 2nd plant coming on-line and Sierra Leone settling
down. But, judging from this thread, there seems to be a lack of
interest so I remain cautious. Any opinions out there?
DIAMONDWORKS ACQUIRES AN OPTION TO PURCHASE THE MONASTERY
KIMBERLITE DIAMOND MINE IN SOUTH AFRICA
VANCOUVER, March 26 /CNW/ - Bruce Walsham, President, CEO and Chairman of
DiamondWorks Ltd., announced today that the company has acquired an option to
purchase 100% of the Monastery Kimberlite Diamond Mine, located in Orange Free
State, South Africa.
The Monastery mine is a previous producer, with the western half of the
pipe having been intermittently mined on a small-scale basis to a depth of
approximately 30 metres. A 100-tonne-per-hour diamond recovery plant, with
crushing, scrubbing, DMS and x-ray recovery units, was constructed at the mine
in the early 1980s. The plant is complete; however, it requires some
rehabilitation and modification before being placed back into operation.
The pipe has a surface area of approximately 0.8 hectares. A near-surface
expansion adds an additional 0.2 hectares to the pipe's dimension to a depth
of 100 metres. Previous, independent evaluations indicate that the mine has
reserves of between 10 and 12.6 million tonnes to a depth of 300 metres. The
average ore grade is estimated to be 0.25 carats per tonne, although there is
a high-grade section, comprising about one-half of the pipe's total tonnage,
with an estimated grade of 0.5 carats per tonne. Based on diamond sales from
previous mining, the estimated carat value of the stones is US$100.
DiamondWorks has paid US$20,000 to secure the option, which comes into
effect on April 1, 1998. DiamondWorks then will have three months to
undertake its initial due diligence of the mine. Part of this due diligence
will be the treatment of a 200-ton sample of existing mine concentrates and
ore to produce a parcel of diamonds for an independent valuation.
If DiamondWorks extends the option beyond three months, the company must
pay US$280,000. The balance of the option period is for 15 months, during
which time DiamondWorks may rehabilitate the on-site mining equipment and
begin test mining. DiamondWorks is entitled to 100% of the revenue from the
diamonds produced during the test-mining period. If, after this 15-month
period, DiamondWorks exercises its option to purchase the mine, the company
will pay US$5.2 million, half in cash and half in common shares of the
company. The agreement is subject to regulatory approval.
The Monastery Mine is the second kimberlite diamond pipe to be optioned
by DiamondWorks in southern Africa this month. Earlier, DiamondWorks acquired
an option on the high-grade portion of the Kao Pipe in the Kingdom of Lesotho,
a country surrounded by, but independently governed from, South Africa.
''The acquisition of options on the Monastery and Kao kimberlites provide
us with the opportunity to significantly expand our diamond production,'' Mr.
Walsham stated. ''Both pipes appear to be suitable for development of
low-cost, open-pit mines capable of producing substantial volumes of
good-quality gems.''
DiamondWorks is a global diamond mining and exploration company. The
company controls five diamond concessions in Angola, including the Luo and
Yetwene mines. The company also controls six diamond concessions in Sierra
Leone, including the Koidu kimberlite diamond mine, and is exploring for
diamonds in Canada's Northwest Territories. The company has interests in five
gold and polymetallic exploration ventures in China and in various gold
exploration properties in Venezuela.
DiamondWorks' shares trade on the Toronto and Vancouver stock exchanges
under the symbol DMW.
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March 10, 1998
DIAMONDWORKS ACQUIRES DIAMOND PIPE IN SOUTHERN AFRICA;
ANNOUNCES FIRST QUARTER PRODUCTION FROM LUO MINE;
UPDATES PROGRESS AT YETWENE MINE AND STATUS IN SIERRA LEONE
DiamondWorks' chairman and chief executive officer Bruce Walsham
announced today that the company has secured an option
to purchase a 100% interest in the high-grade portion of the Kao
diamond pipe located in the Kingdom of Lesotho, Southern
Africa.
Based on available geological data from previous exploration work on
the pipe, the portion of the Kao pipe that DiamondWorks
has optioned has a reported grade of about 18 carats per 100 tonnes
and contains an estimated diamond resource of 2.7 million
carats. The data indicate that the diamonds are of good quality, with
an estimated value of US$135 a carat.
While the eight-hectare portion optioned by DiamondWorks represents
about 40% of the Kao pipe's total surface area of 19.8
hectares, the optioned area contains about 65-75% of the pipe's total
diamond value. DiamondWorks is negotiating to acquire the
rest of the pipe.
The option is for one year, with a right of extension by DiamondWorks
for a second year. DiamondWorks is obligated to make
payments totalling US$245,000 to compensate the owner for lost diamond
production during the first year, and US$200,000 (or
US$400,000 in certain circumstances) in the second year. DiamondWorks
made the first payment of US$90,000 when it signed
the option agreement. The remaining US$155,000 for the first year is
to be paid in three, quarterly installments commencing in
June 1998.
DiamondWorks will undertake due diligence, including test mining, to
confirm the pipe's economic potential. The company has
no minimum-spending requirement during the term of the option.
DiamondWorks is entitled to 90% of gross diamond sales for
all diamonds recovered from the project during the first year of the
option, and 80% during the second year. If DiamondWorks
exercises the option, it will have to pay US$1.5 million in cash and
US$1.5 million in DiamondWorks shares. In addition,
DiamondWorks will pay a royalty of 1.5% on all future gross diamond
sales. The transaction is subject to all requisite approvals.
Luo Mine Produces More Than 14,500 Carats During First Quarter of
Fiscal 1998.
Mr. Walsham also announced that the company's Luo diamond mine in
Angola produced more than 14,500 carats in the first
quarter of fiscal 1998 (December 1, 1997 to February 28, 1998). The
average daily production rate in the quarter was 236 carats.
The mine was closed from December 18 to January 5 for the Angolan
Christmas holidays.
At the end of the first quarter, DiamondWorks had an inventory of
diamonds totalling more than 20,000 carats. The diamonds
include many good-quality gems larger than five carats - one of them a
50.2-carat gem recovered in late January. DiamondWorks
is in the process of selling a parcel of approximately 15,000 carats
in Antwerp, Belgium.
Drilling on the Camatchia and Camagico Pipes
DiamondWorks has now completed 23 holes on its pre-feasibility
delineation drilling at the Camatchia diamond-bearing
kimberlite pipe at the Luo Mine. The pipe is roughly circular and has
a diameter of about 650 metres. The surface area is 27.9
hectares, making it the world's tenth-largest diamond pipe. The drill
core has been split and sent to laboratories in Australia and
South Africa for preliminary diamond grade determination as an initial
step in confirming earlier resource estimates provided by
Diamang, the former Angolan mining consortium that included De Beers.
Diamang evaluated Camatchia in the 1960s and 1970s
and estimated that the pipe contains diamond resources of more than 13
million carats to a depth of 300 metres.
Mr. Walsham expects that initial results from current test work will
be available later this month. DiamondWorks' drilling has
revealed that the Camatchia pipe has not been seriously eroded, with
the top 30 metres comprised of crater facies. Below 30
metres, drilling intersected diatreme, which is continuous to the base
of the deepest hole of nearly 115 metres vertical depth. The
walls of the diatreme appear to be steep-sided, meaning that the
diameter of the pipe remains fairly constant to a depth of about
100 metres. The next step in the evaluation at Camatchia will be to
obtain a 100,000-tonne bulk sample, which will commence
once all drilling results are evaluated. The bulk sample is a key step
in producing an independent estimate of the economic
potential of the Camatchia Pipe.
Pre-feasibility delineation drilling is now underway on the 20.7-
hectare Camagico pipe, located four kilometres south of the
Camatchia pipe, on DiamondWorks' Luo concession. Camagico is the
world's twelfth-largest diamond pipe and was one of two
kimberlite pipes in Angola that were placed into production in the
early 1970s by Diamang. The pipe and the overlying alluvial
gravels were mined to a depth of 23 metres before operations were
suspended in 1984. Diamang reported that a high proportion
of the diamonds mined from Camagico were colored stones, with eight
percent of them valuable light pinks.
Yetwene Mine Scheduled to Begin Production in June, 1998
At the Yetwene concession, located 100 kilometres north of the Luo
Mine (see accompanying map), delivery and installation of
the 100-tonne-per-hour diamond processing plant for DiamondWorks'
second Angolan diamond mine has now begun.
Earth-moving mining equipment has arrived in Angola and will be
trucked to the mine site shortly. The new diamond recovery
plant is scheduled to begin production in June. Management believes
that production from the Yetwene Mine will enable
DiamondWorks to more than double its diamond production from Angola,
to an expected level of 175,000 carats a year.
Sierra Leone Update
Mr. Walsham reported that the situation is now calm in the Kono
district of eastern Sierra Leone, the location of the company's
Koidu kimberlite diamond mine. There has been sporadic fighting in the
Kono district in recent weeks, following the ouster of
the military junta that seized power from President Ahmed Tejan
Kabbah's democratically-elected government last May.
DiamondWorks' office facility in Freetown suffered minor damage from
looting; however, the company's diamond processing
plant and fleet of mining equipment at Koidu is apparently intact.
DiamondWorks' country manager will meet with President
Kabbah this month to discuss plans for the company to recommence its
bulk-sampling/test mining operations at the Koidu Mine.
DiamondWorks is a global diamond mining and exploration company. The
company controls five diamond concessions in
Angola, including the Luo and Yetwene mines. The company also controls
six diamond concessions in Sierra Leone and is
exploring for diamonds in Canada's Northwest Territories. The company
has interests in five gold and poly-metallic exploration
ventures in China and in various gold exploration properties in
Venezuela. |
