Sign up United Kingdom
Proactive Investors - Run By Investors For Investors

Stellar Diamonds completes Baoulé sampling early

The company revealed that the quality of diamonds in the larger eastern lobe is higher than those from the western lobe
Large diamond
The company’s resource target is, as previously indicated, some 3mln carats contained within the Baoulé pipe.

Stellar Diamonds PLC (LON:STEL) has completed the 100,000 tonne bulk sample at its Baoulé kimberlite project in Guinea.

The company revealed 11,808 carats were recovered at an average grade of 11.4 carats per hundred tonnes (cpht), using a +1.25mm cut-off.

Stellar added that to date, more than 8,400 carats have been sold in three diamond sales, bringing in more than US$1mln in revenues. The higher quality gems have been achieving prices of up to US$6,800 per carat, it added.

The sale of a further 3,100 carats are planned later this month, with all of the diamonds extracted from the western lobe, which is generally yielding lower quality gems than the larger eastern lobe. The grade of the eastern lobe is clocking in at 13.3 cpht, compared to 9.8 cpht at the eastern lobe.

“This planned sale will add to US$1 million generated to-date from diamonds sold, which has contributed significantly to the costs of the exercise,” said Karl Smithson, chief executive officer (CEO) of Stellar Diamonds.

Meanwhile, the company is set to receive a further influx of funds via a shareholder loan. Shareholders Altus Strategies and Deutsche Balaton are to provide funding to the company of £465,000 in aggregate.

The proceeds of the loan will be used for working capital purposes as the company advances its mining licence application for its Tongo kimberlite project in Sierra Leone and establishes a maiden resource at its Baoulé.

The loan short-term loan bears an interest rate of 20% a year.

"The trial mining exercise at Baoulé has been successfully completed, ahead of schedule, through the processing of over 100,000 tonnes of kimberlite from the eastern and western lobes of the five hectare pipe,” noted CEO Karl Smithson. 

“A total of 929 stones greater than one carat have been yielded, including numerous high value gem and fancy coloured (yellow) diamonds. Additionally as announced on 15 March 2016, one 55 carat stone has been recovered, which confirms the company's belief that the Baoulé pipe is a source of large diamonds that are renowned in the Aredor area of Guinea,” Smithson added. 

Once this month’s diamonds sale is out of the way, Stellar will then complete the necessary diamond grade and value modelling as part of the resource estimation exercise. The company’s resource target is, as previously indicated, some 3mln carats contained within the Baoulé pipe. 

When the grading and modelling has been completed it will allow the company to formulate the next development steps for the project.

“The company was able to confirm a difference in grade between the (volumetrically) larger eastern lobe (averaging 13.3cpht) and smaller western lobe (9.8cpht) lobes. Having said that, Stellar also noted that the difference could be due to differing processing efficiencies of the different kimberlite types,” noted broker Shore Capital.

Shares in Stellar were up 4.6% at 6.8p in a falling market in the first hour of trading.

View full STEL profile View Profile

Stellar Diamonds PLC Timeline

Related Articles

April 03 2018
The strategic review aims to assess how the company can best leverage its position as the owner of one of the world's largest sapphire mines.
Bag of diamonds
July 06 2018
In a production update, the AIM-listed diamond miner said production in the first half of the year was up 81% year-on-year at 73,028 tonnes

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use