TORONTO (miningweekly.com) – Montreal-based Stornoway Diamonds on Thursday reported the valuation results of the recent Renard 65 bulk sample from its flagship Renard diamond project.

WWW International Diamond Consultants in Antwerp, Belgium, using their March price book, undertook the valuation.

The valuation put an average price of $250/ct on the total Renard 65 parcel of 997 ct.

WWW had developed a diamond-price model for Renard 65 of $180/ct, with a ‘high’ sensitivity of $203/ct and a ‘minimum’ sensitivity of $169/ct.

Stornoway also said the two largest stones recovered in the bulk sample were valued at $8 500/ct for a 9.77 ct (G colour) stone and $5 900/ct on the 6.40 ct (F colour) stone.

"This new valuation work has confirmed a high-quality diamond population at Renard 65 that we anticipate will now allow the addition of a substantial quantity of new, openpit resources to the project's mine plan,” Stornoway CEO Matt Manson said.

He added that two features of this work stood out.

“Firstly, the two large stones in the sample have been confirmed by WWW as among the most valuable stones recovered at the project to date. Their large impact in the parcel valuation has been tempered, appropriately, in the recommended base-case price model, but their presence confirms a key characteristic of the Renard project: upside value potential in large gems.

“Secondly, the WWW work has determined that Renard 65 possesses a diamond population with a different, and generally better, assortment of qualities than is seen in the other Renard kimberlite pipes,” Manson said.

This had prompted a re-evaluation of the valuation models used in the project, which had previously been based on the assumption that Renard exhibited a single diamond population sampled by multiple pipes. “The consequences of these findings for the project are significant, and positive," he said.

Within the larger Renard mineral resource inventory, Renard 65 contains an inferred mineral resource of 3.7-million carats (representing 12.9-million tons at an average grade of 29 ct per hundred tonnes) to a depth of 290 m, with an exploration potential estimated at between 6.8-million and 13.7-million carats from 290 m to 775 m in depth.

The current Renard mine plan currently provides for mining 17.9-million carats from the Renard 2, 3 and 4 reserves from a combined openpit and underground mine, at a processing rate of 6 000 t/d.

Stornoway expected the new openpit resources at Renard 65 could result in the processing capacity being increased to 7 000 t/d and the project's reserve life being extended.

The Renard 65 valuation exercise had also afforded an opportunity to calibrate the value of the Renard 2, 3 and 4 diamond parcels in the current market against the May 2011 price assumptions that were used in the November 2011 feasibility study and subsequent optimisation study.

Over this period, the diamond market had experienced a high degree of price volatility, including a sustained period of weakness in 2012. However, the market had recovered in the first quarter of this year and WWW had reported that prices for Renard-specific diamond assortments were currently within 7% to 8% of May 2011 levels.