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MODERN MINING
November 2015
MINING News
In its quarterly activities report (to
30 September 2015), ASX-listed Mustang
Resources, which holds the Save River
diamond project in Mozambique, says
“robust” gem-quality diamond recoveries
continued during the reporting period.
In 2014, Mustang acquired rights to
earnmajority interests in the two diamond
exploration licences in Mozambique mak
ing up the Save River project. The project
area comprises 24 000 ha and is situated
in the Save River Valley, downstream from
the well-known Murowa and Marange
diamond fields in Zimbabwe.
Mustang reports “robust”diamond recoveries at Save River
Significantly, many of the known kim
berlite pipes in Zimbabwe have been
weathered away and the diamonds from
the diamondiferous pipes have been
washed down the river systems through
the Save River. To date, Mustang has recov
ered multiple gem-quality diamonds and
considers that the project represents a
robust opportunity to establish a large-
scale alluvial diamond mining operation.
In July and again in October, Mustang
recovered 2,5-carat white diamonds from
the shallow surface gravels at Save River.
These are the largest diamonds to be
The bulk sampling plant at the Save River diamond project (photo: Mustang Resources).
recovered from the project to date.
After the end of the quarter, Mustang
announced the completion of the phase 1
exploration and bulk sampling programme
at the project. The programme yielded 18
gem-quality diamonds from seven shallow
trial pits.
As of late October, a total of 47 dia
monds totalling 30,28 carats had been
recovered from bulk sampling activities,
which – says Mustang – further reinforces
its view that there is significant share
holder value to be unlocked within the
Save River project.
The company will continue to work
towards defining a JORC-compliant min
eral resource at Save River, while awaiting
the results of drilling in order to determine
the next priority targets for bulk sampling.
Mustang is confident that with a new
Flow Sort recovery unit now in place,
and with the diamond recovery plant
upgraded to operate at 1 000 tons per
day (compared to 100 t/d previously), the
recovery and quantity of diamonds will be
significantly increased as the exploration
and sampling programme is ramped up in
the coming months.
Lace to soon start its production ramp-up
In its latest update on its Lace diamond
mine near Kroonstad in the Free State,
AIM-listed DiamondCorp says develop
ment work in the Upper K4 (UK4) block is
concentrating in kimberlite on the 310 m
production level in preparation for produc
tion ramp up to commence before the end
of the year.
During September tunnelling activities
advanced fromheavily diluted low-grade K6
kimberlite on the southern side of the kim
berlite pipe into a transitional zone and then
into higher-grade K4 kimberlite in the cen
tre of the pipe. As a consequence, ground
conditions improved and kimberlite devel
opment rates exceeded the monthly call in
October.
Challenging ground conditions reported
previously on the 290 m doming level have
been overcome with the installation of steel
arched sets which provide a safe canopy for
employees and equipment from potential
falls of ground. The void above the canopy
is now being back-filled.
However, the time taken to install the
sets and make the area safe has resulted
in a delay to the blasting of the slot drive
from which the initial tonnage ramp up
commences.
This delay will result in cashflow pressure
on the company’s 74 %-owned operating
subsidiary, Lace Diamond Mines (Pty) Ltd,
in Q1 2016 when debt repayments are due
to commence. As a result, detailed discus
sions have been held with the company’s
primary lenders and BEE partners regarding
options to alleviate cashflow pressures.
The discussions have been positive and
a formal request to continue interest roll-up
of the Industrial Development Corporation
loan until positive cashflow is achieved has
been lodged. Management do not expect
any issues with respect to being granted
this request.
Processing of K6 kimberlite and K4 kim
berlite recovered from the production level
drives and bulk test sites continued with
further encouraging results.
Development costs to date are averag
ing R49 993 per metre against a budget of
R38 280 per metre as a result of the chal
lenges encountered, including a weaker
than expected Rand exchange rate. The
commissioning of the conveyors will now
have a positive impact on reducing devel
opment costs as trucks will no longer be
used in decline development to the block
cave level.
Lace’s 220 t/h dense media separation
plant operated efficiently on a batch basis
during the reporting period, processing
5 825 tonnes of K6 and K4 kimberlite bulk
samples extracted from the development
tunnels.
A 3-tonne bulk sample of the Lace kim
berlites was despatched to Johannesburg
for testing using one of the high volume
optical/x-ray waste sorters DiamondCorp
has been investigating. The test work
was very positive, and demonstrated that
the majority of the waste can be ejected
ahead of the DMS processing plant. This
technology, combined with the significant
water savings generated from the instal
lation of the de-grit circuit, means, says
DiamondCorp, that there is potential for
Lace to be mined at a faster rate than is
currently planned. This will have a positive
impact on mine economics and the NPV of
future cashflows.