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Tango Mining unveils new resource estimate at BK11

Tango Mining unveils new resource estimate at BK11
More than US$45mln was previously spent at BK11 on pit development, a processing plant and infrastructure

The latest resource estimate for the BK11 kimberlite diamond mine in Botswana is in line with Tango Mining’s (CVE:TGV) expectations.

The inferred resource is 17.4mln tonnes (Mt), containing 780,820 carats, of which around 9.0 Mt averages 6.8 carats per hundred tonnes (cpht) for a total of 608,000 carats. Higher grade areas of 9.8 cpht have also been identified.

Notably, BK11 also contains good quality white diamonds in the top 10% of global gem diamond production in terms of value per carat (ct), Tango said.

The recovery of a 1.5 ct high quality Type IIa D colour diamond is significant as it indicates the presence of top quality stones within the BK11 kimberlite, with the potential for large 100 plus carat stones, it added.

Based on the 2015 market, diamond valuation experts advise a minimum average price of US$236/ct, a modelled price of US$260/ct and an upside price of US$285/ct.

Terry Tucker, executive chairman, told investors: “The resource tonnage and grade is consistent with our initial assessment of this acquisition opportunity and the improved diamond valuation could enhance the economics of this project.

"The recently announced positive production results and recovery of exceptional stones from nearby neighbouring mining operations, that implemented similar autogenous milling technology bodes well for the future performance of BK11, and provides confidence in our development and investment decision. Our immediate goal is to focus on financing the acquisition and development cost and transition into project development and production."

Tango has run feasibility studies alongside the resource work and is preparing a  preliminary economic assessment (PEA) report. 

The BK11 mine lies on a mining licence held by Monak Ventures, a subsidiary of Firestone Diamonds (LON:FDI).

Tango has entered into a sale of shares and claims agreement with Firestone, whereby the company has agreed to acquire all of Firestone's right in the BK11 Mine processing facility, and interest and title in the mineral rights.

Before being put on care and maintenance in February 2012, more than US$45mln was spent at BK11 on pit development, a processing plant and infrastructure.

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