Firestone Diamonds (LON:FDI) announced the successful completion of its first diamond tender held at its new sales office in Botswana, selling a total 14,673 carats for proceeds of US$1.6 million.
The first tender marks the completion of Firestone’s transition into one of only three listed junior kimberlite producers worldwide, the group said.
The average price achieved in the sale of 12,510 carats from the Main Pipe at Liqhobong of US$98/carat was 14% higher than previous valuation of US$86/carat.
Firestone is expecting to achieve diamond prices of over US$100/carat from Liqhobong next year.
A total 2,162 carats were sold from the BK11 mine at an average price of US$177/carat, in line with the previous valuation of US$175/carat, with Firestone also expecting higher prices in 2011 as mining progresses into higher grade kimberlite.
“We are very pleased that the prices achieved for both Liqhobong and BK11 production were higher than expected, and we believe that further price increases will be achieved for production from both of these mines in 2011,” said chief executive of Firestone Diamonds Philip Kenny.
The tender ran from 29 November to 9 December 2010, and was attended by more than 30 diamond buyers from Belgium, Israel, India, Russia and Southern Africa.
Firestone plans a total nine diamond tenders for 2011.
The average size of the BK11 tenders is expected to be approximately 12,000 carats, and the average size of the Liqhobong tenders is expected to start at approximately 15,000 carats, increasing to 50,000 carats by the final quarter of the year.
At Liqhobong, the company recently announced a £13 million financing that will allow production to recommence at the Main Pipe in Q1 2011, with production capacity to be tripled to 1.3 million tonnes per annum by Q4 2011.
With an average estimated diamond value of US$86/carat and a contained value of approximately US$2.7 billion,
Firestone considers Liqhobong to be one of the most attractive undeveloped kimberlites in the world.
Initial mine planning and pit optimisation studies on Liqhobong indicate that open pit mining operations can be undertaken to a depth of 390 metres and would result in the mining of approximately 60 million tonnes of kimberlite and 19 million carats over a period of approximately 17 years. No waste stripping will be required for the first 9 million tonnes.
Firestone is also the largest holder of mineral rights in Botswana's diamondiferous kimberlite fields, controlling approximately 10,000 square kilometres around the major Orapa and Jwaneng mines and the entire Tsabong kimberlite field. In addition to Liqhobong and BK11, Firestone has 108 kimberlites in its portfolio, of which 30 have been proven to be diamondiferous.