Despite the current lack of an active diamond mining industry in West Africa, the effects of political instability and the impact of the Ebola outbreak in the past year, London-listed diamond company Stellar Diamonds remains committed to bringing its key diamond projects there into operation in the near future.

The company reaffirms that it is on track to submit its mining licence application for the Tongo kimberlite diamond project, in Sierra Leone.

“We expect to formally submit all required documentation for the mining licence this month,” comments Stellar CEO Karl Smithson, noting that the environmental- and social-impact study, which forms part of the application, was more than 80% complete in October.

Following the granting of the mining licence, which Smithson believes will be achieved in early 2016, the company will focus on securing about $25-million in funding to progress mine construction and infrastructure to allow for first production at the end of the first year after development begins.

In August, Stellar Diamonds reported that the preliminary economic assessment (PEA) on the Tongo project “has delivered robust economics, which support the development of a surface slot and subsequent underground mine”.

The PEA focussed on the base-case grade and resource model of 120 ct per hundred tonnes (cpht) and 1.1-million carats to a depth of between 300 m and 400 m from surface over an initial 18-year life-of-mine.

Smithson reiterates the importance of the diamond project, highlighting the significant employment and development opportunities that the mine can provide, particularly in an area substantially affected by the Ebola crisis.

“Such a mine – by virtue of its nature as a surface and underground operation – is labour intensive. This will support the evolution of a 500-strong workforce and will have a social impact on at least 5 000 people, excluding the support provided for secondary industries and suppliers,” he says.

Baoulé Focus
Stellar Diamonds further remains focused on continuing the trial mining evaluation of the 5 ha kimberlite pipe at Baoulé, in Guinea, and expects to restart trial mining this month, following the stoppage during the rainy season.

The pipe, which has openpit mine potential, is located in the Aredor diamond district, which the company notes has historically yielded large, high-value diamonds from alluvial mining.

Stellar Diamonds has modelled an internal resource estimate of 22-million tons for Baoulé, containing 3.3-million carats at +1.25 mm grade of 15 cpht down to a depth of 300 m. The target diamond value, assuming large special stones are recovered, is $200/ct.

The trial will be conducted for another six months, or at least until May 2016, for the company to complete the bulk sampling and processing of its targeted 100 000 t and the production of about 12 000 ct to 13 000 ct. The mining trial will be paired with a few more diamond sales.

Following the completion of the trial mining, Smithson hopes to have a precise grade and diamond value for the deposit. Stellar Diamonds will then decide on the feasibility of the project.

To date, the Baoulé trial has processed just under 50 000 t and produced just under 7 000 ct, while Stellar Diamonds hosted two diamond sales this year totalling $700 000 in revenues. Smithson points out that the most recent sales received a high dollar value for each carat, at about $156/ct.

However, the company believes that the site can yield larger stones – in the 50 ct to 100 ct range – which would increase the diamond price and underline the economic potential of the deposit.

Potential Resource
Stellar also holds the Droujba kimberlite pipe to the south-east of Baoulé. The company has defined a high grade of 80 cpht to 100 cpht of a 2.5-million carat resource over the Droujba pipe, and a further 448 000 ct resource along a 0.5 km section of the 5-km-long Katcha dyke for a combined project resource of three-million carats.

While Smithson acknowledges that Droujba has been placed “on the back burner”, with the key focus on Baoulé currently, he concludes that, when the diamond market and, consequently, prices experience an upswing, Droujba will come into play.