AIM diamond miners refuse to sparkle

Shares in diamond companies Paragon Diamonds (PRG) and Firestone Diamonds (FDI) refused to sparkle as the companies updated investors.

Paragon Diamonds

Paragon Diamonds has announced microdiamond results from four samples totalling 863 kilograms from its Motete Dyke in Lesotho.

A total of 1,641 diamonds were recovered weighing 0.9841 carats, equivalent to 1.14 carats per tonne.

"The Motete Dyke continues to yield a high proportion of clean crystal forms with exceptional colour and transparency," confirmed the company. More than 70% of the diamonds were of dodecahedral and octahedral shapes, with a transparency rate exceeding 95%.

The company has now submitted all microdiamond results obtained to date for a comprehensive grade-modelling exercise. Should these results prove positive, the company will begin sampling the Motete Dyke for larger macrodiamonds for treatment through the nearby Lemphane bulk sampling plant. The sample is anticipated to yield up to 1,000 carats of macrodiamonds.

"The Motete Dyke is without a doubt consistently diamondiferous to a high degree," commented managing director Stephen Grimmer. "Providing the expected positive results from the comprehensive grade-modelling exercise are obtained, the company will embark with confidence on a resource development programme as a first step towards a full scoping study," he added.

Shares in the company were broadly unchanged on the news.

Firestone Diamonds

On the other hand, investors pushed down shares of Firestone Diamonds by more than 7% despite chief executive Tim Wilkes saying that he was "cautiously optimistic" for the months ahead.

At the Liqhobong Mine in Lesotho, plant throughput increased from 0.4 million tonnes to 0.6 million tonnes per annum, with the recovery of three broken diamonds of approximately 100 carats.

"The recovery of three plus-100 carat diamonds, albeit broken, confirms Firestone's conviction that the resource has the ability to produce much higher value diamonds than recovered to date," said Wilkes, stressing that he was "very pleased" with the performance of the plant at Liqhobong over the past two months.

"We are implementing a programme of continued improvement and enhancement to maximise the recovery of diamonds and we are confident that we will see positive results over the coming weeks," he added.

However, technical challenges remained at the BK11 Mine in Botswana, with management currently considering "various strategic alternatives".

Finally, the company boasted of a "well-supported" first tender on 3 February. The tender was attended by 35 international diamond buyers, and all stock available in the tender was sold.

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