JOHANNESBURG (minigweekly.com) – Aim-listed diamond explorer West African Diamonds plans to grow by mergers and acquisitions and said it expects its Bomboko mine in Guinea to reach full capacity by year-end.

The company said on Wednesday that monthly carat production at Bomboko was expected to rise to more than 2 000 ct/m once full capacity was reached, providing the company with a robust revenue stream.

The Bomboko mine was constructed during 2008 and in the first part of 2009, and started operations in June.

West African Diamonds chairperson John Teeling said that current diamond grades mine at Bomboko were within expectations, averaging 6,5 ct/100 t, at a value of $116/ct.

Teeling that the company would increase production by installing an additional 16-foot pan processing plant. Large excavators were also in use.

Teeling also said that the group’s future strategy would be to grow by mergers and acquisition.

He noted that as the world recovered from the economic downturn, the potential for growth in the diamond industry was “very bright”. However, he added that in recent years, there has been limited diamond exploration success, and as most mines were depleting, a gem supply deficit was possible.

“This impending shortage is the opportunity for West African Diamonds. We are a producer of high-quality stones. We have known reserves, we are experienced in the industry, but we are too small.”

He added that investors, particularly institutional investors, were less likely to invest in small market capitalisation companies. 

Teeling said that although initial merger discussions were futile, the company was still continuing.

“I am hopeful that a good result will come from these talks. If positive, it would be a step toward building an independent gem quality diamond producer, founded and focussed in developing high grade and high value diamond resources in West Africa.”

The Bomboko licence was estimated to contain at least 750 000 ct of diamonds.

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