Diamond Fields International has sold a parcel of 4,450 carats in Antwerp for an average value of $164 (U.S.) per carat. This price exceeded the company’s expectations and indicates improved market confidence. The market for diamonds in the size and quality of stones found in the company’s Namibian properties have partially rebounded after an estimated 20-25 per cent decline in 1998.
The diamonds sold were those recovered from phase 1 of the company’s advanced sampling program conducted by De Beers Marine in November 1998 on DFI’S offshore concession in Namibia near the town of Luderik. The program yielded an average sample grade of 1.3 carats per square metre from 67 sample sites representing a fivefold increase above the previously estimated grade for the entire feature. Based on the average sample grades for the area sampled, the diamond sales values, and the thin sediment cover associated with the overall feature, the company believes the Marshall Fork feature represents the most potentially profitable sea diamond deposit known. The company’s phase 2 program is expected to validate this belief.
The company is proceeding with the $1.5-million (U.S.) Phase 2 program. The program plan has been modified to grid line sample the balance of the 1.3 million square metre Marshall Fork feature. Proceeds from diamond recoveries from sampling and test-mining activities are expected to substantially offset the cost of the program. Sampling in phase 1 was limited to an area where the water depth was in excess of 65 metres due to restrictions of the sample recovery system on De Beers Marine’s sampling vessel, the mv Coral Sea. The Coral Sea normally operates in water depths of 120-180 metres when conducting evaluation sampling under contract to Namdeb in Namibian waters northwest of the mouth of the Orange River.
De Beers Marine is planning to modify the sampling discharge system on the vessel in the next several months to allow operations to be conducted in water depths as shallow as 40 to 45 metres. With the modifications the vessel will be able to work in the balance of the feature. DFI and De Beers Marine are currently finalizing contract negotiations for phase 2 sampling services to begin once the vessel has been modified sometime around midyear. Immediately thereafter, a feasibility study for an initial mining operation would be undertaken.
The company also plans to conduct further sampling on the concession. phase 3 of the program is designed to both upgrade and expand the overall resource by resampling two known features with proven techniques and systematically examining two large features not previously sampled. Overall the goals for the program are to outline sufficient resources to support a multifaceted, long life operation capable of producing several hundred thousand carats per year.
