JOHANNESBURG (miningweekly.com) – Aim-listed Stellar Diamonds has decided to proceed with the development of its Tongo kimberlite diamond project, in Sierra Leone, and continues to progress the compilation of an environmental- and social-impact study (ESIA) as part of the mining licence application process.
The company’s decision followed the positive outcome of a preliminary economic assessment (PEA) of the project.
The PEA determined that the mine would have an 18-year life, yielding 955 930 ct from surface and underground mining.
The first four years would yield 117 806 ct, providing early cash flow. The mine was expected to require low capital expenditure of $24.2-million.
“The Tongo PEA has delivered robust economics, which support the development of an openpit and subsequent underground mine. Stellar considers that the Tongo mine can be further improved and extended with the development of additional diamond resources from nearby high-grade kimberlites that we have previously identified and tested,” Stellar CEO Karl Smithson commented.
He added that the company expected to formally submit the mining licence application in the near future, once it had secured an environmental licence.
TerraNova-EcoSys Limited was compiling the ESIA, which would be submitted to the Sierra Leone Environmental Protection Agency for approval of an environmental licence.
The PEA had focused on the base case grade and resource model of 120 carats per hundred tons and 1.1-million carats to a depth of between 300 m and 400 m from surface.
During the surface mining phase, in the first four years, the first underground shaft and infrastructure would be established to allow the start of underground ore production in the third year and, therefore, allow for a seamless transition from surface to underground operations.
Nominal life-of-mine operating costs, before inflation, would be $73/t, which included mining costs of $34/t for surface mining and $38/t for underground mining.
The escalated average operating cost over the life of the mine was estimated to be about $108/t treated, taking inflation into account.
Meanwhile, Stellar had been granted a two-year extension of its exploration licence, while it works to secure a mining licence for the project.