JOHANNESBURG (miningweekly.com) – Gem-miner TanzaniteOne has secured an option to buy a sapphire project in Australia, as it moves to advance its diversification strategy for premium coloured gemstones, the London-listed company said on Thursday.
CEO Bernard Olivier said that securing an option over the project, located in the Sapphire field, fitted into the company’s diversification strategy by expanding into a new coloured gemstone through a project where it could rapidly implement advanced mining and recovery techniques.
“Our growth strategy is to leverage our extensive coloured gemstone mining, distribution and marketing infrastructure to maximise value of the asset,” he added.
The project would comprise two mining leases covering an area of about 490 ha, which has previously been mined and produced sapphire.
The assets to be acquired comprise mining licences, tangible assets, completed exploration and operational and sales data over the mining licence area.
The company produces tanzanite from a single known resource at the foothills of Mount Kilimanjaro in Tanzania and started its strategic move into new coloured gemstones with a move into tsavorite, which is a green gemstone also found in Tanzania.
TanzaniteOne said that both tsavorite and sapphire currently achieved a higher price per carat than tanzanite.
The total consideration for the project, if the company elects to proceed on completion of the due diligence, would be cash of A$.2-million and 18-million fully paid common shares in TanzaniteOne, at the market price at the time of completion, representing about 13.5% of the enlarged issued capital.
The company reported a 48% increase in its first-quarter sales, while production rose by 8%. Sales rose to $3.96-million in the first quarter from $2.68-million in the same period last year.