Diamond Fields International Ltd. has provided an update on its Namibian offshore diamond concessions.
Agreement on mining program
Diamond Fields is pleased to report that International Mining and Dredging Holdings (Pty.) Ltd. (IMDH) and the company have agreed to an initial mining program on its ML 111 licence. The initial mining program is scheduled to commence in 2018 and will extend over a sea floor area of approximately 55 hectares. The program is to be executed using the state-of-the-art Ya Toivo mining vessel, which is equipped with a four-point-mooring-system-integrated anchor assist and a dynamic positioning (DP2) system that ensures vessel stability during turbulent sea conditions. The vessel is further equipped with a remotely operated subsea tractor capable of highly efficient and selective mining on the sea floor.
The company has further concluded discussions with IMDH concerning its share of the 2016 bulk sampling program. All costs associated with this multimillion-dollar program were paid for by IMDH. The parties have agreed that the company will be paid $670,000 (U.S.) within 30 days. The results from the bulk sampling program were extremely encouraging, with an unexpected high frequency of large, high-value stones. Diamonds recovered from the company’s ML 111 in Namibia are typically of the highest gem quality, but recent bulk sampling results have exceeded the company’s expectations.
It has been agreed for the duration of the forthcoming initial mining program and dependent on monthly production levels that the company’s share of net proceeds (after costs) shall be not less than 5 per cent and the company anticipates that it could approach 50 percent of its joint venture interest (10 per cent of total proceeds before tax and after deduction of export levies). The parties expect to review mining costs and other parameters during the initial mining program to find a balance for sharing exploration and mining costs going forward beyond the initial mining program, particularly regarding resource and reserve development.
Sybrand van der Spuy, chief executive officer of Diamond Fields, said: “We are extremely excited at the prospect of being back in production in the very near future. Our product is recognized throughout the world for its exceptional quality, being 98 per cent gem, and we look forward to bringing this niche product back to the market again. This program will provide our company with the opportunity to generate significant cash flow in short order.”
The company is pleased to reaffirm its continuing commitment to its Namibian operations with this announcement.
