Australian Stock Exchange-listed Mustang Resources has announced that it has recovered ten rubies during exploration and trenching work at its Montepuez project, in Mozambique. The rubies totalled 2.16 ct. Mustang’s project is located adjacent to UK miner Gemfields’ already operational Montepuez ruby mine (which held its first ruby auction in June 2014). The Montepuez district lies in the north-western province of Cabo Delgado, some 150 km west of the coastal city of Pemba.

Mustang has a small-scale processing facility (known as a bushman jig) operational on its site and is continuing with its trenching programme. This is intended to help with the mapping of gravel layers that are prospective for rubies and to establish targets for the planned bulk sampling programme. The company is currently concentrating on starting this bulk sampling and hopes to be able to generate cash flow from the project in the near term.

“The recovery of ten rubies from alluvial sources at the Montepuez Ruby Project is very encouraging and the team is buoyed by this early-stage success,” commented company MD Christiaan Jordaan in a press release. “Work is continuing with the trenching and processing of additional pits as we advance towards the commencement of bulk sampling in the third quarter of 2016. “We look forward to updating our shareholders on further progress at Montepuez in [the] coming weeks.”

In aninvestor presentation in April, the company stated that it was “[f]ocused on becoming a near-term gemstone producer through [the] development of the Montepuez Ruby Project”. “[The] Montepuez Ruby Project is located in a world-class ruby province . . . [There is v]ery strong ruby market growth, with Mustang perfectly positioned to become a major ruby supplier. Low capital requirement to undertake the programme [is] aimed at generating cash flow to fund commercial mine development.”

The trenching programme is part of Phase 2A of the company’s exploration activities at Montepuez and started on June 25. The licence areas cover a combined total of 158 km2 and the company’s share in them varies from 52% to 60%. The bulk sampling plan is to carry out openpit mining, establish a stockpile of material and then transport the material to a scrubber, which will separate out fines, which will become tailings, while the rest of the material will go to a 16 ft rotary pan and then to a dewatering screen (which will separate out waste water, slime and more tailings). Thereafter, the material will pass through a containerised glove box (which will separate out yet more tailings), to be followed by ruby grading.

Of the equipment required, most of the processing machinery is already in the possession of the company. The remaining machinery and transport equipment are or will be wet-leased locally. Mustang has adopted this approach to minimise the capital expenditure necessary to implement the bulk sampling programme and to start recovering rubies for sale. The company is also developing the Balama graphite project and the Save River diamond project, both also in Mozambique.