Broker Northland has reiterated its bullish stance on the diamond sector following an upbeat assessment of the outlook for the market by industry experts and players, including Firestone Diamonds (LON:FDI), at a recent Mining Journal investor conference.
Northland analyst David Johnson notes that while conference speakers generally indicated slower price growth, the growing involvement of China and India in the market should help ensure the market remains ‘robust’.
Highlighting the contribution from sector players, Johnson notes that Firestone, which operates the significant Liqhobong Mine in Lesotho and the BK11 mine in Botswana, spoke confident about the future.
Firestone is one of the very few junior-listed kimberlite producers worldwide. The company’s remarkable transition was due, in part, to its 2010 acquisition of Kopane Diamonds.
Last year the company brought the BK11 mine into production, while at about the same time it brought Kopane’s much bigger Liqhobong mine into the fold.
Liqhobong, which is in Lesotho, is worth an estimated US$2.7 billion based on the 91 million tonne resource which contains 31 million carats (average grade of 34 carats per hundred tonnes).
At BK 11, Firestone plans to mine 11.5 million tonnes of kimberlite at an average grade of 8.5 carats per hundred tonnes.
At the conference Firestone hailed the merits of operating in Botswana, the so-called Switzerland of Africa, with the company expressing confidence in the country mining regulatory regime.
Late morning Firestone shares were down 0.25p to 30p.