Paragon Diamonds (LON:PRG) has secured a one year extension to its key Lemphane kimberlite exploration licence in Lesotho, providing it with enough time to complete the necessary work at the project.
The group obtained the licence in May 2011 and immediately started a rapid exploration programme to evaluate the kimberlite. The licence, which will now run until June 2013, had just over a year left at that time and minimal work had been undertaken.
During the additional year, Paragon will complete the bulk sampling programme that is currently underway, increase the tonnage taken from sample locations in the kimberlite and conclude the evaluation work.
The company will then start a scoping study, aiming to obtain a trial mining licence thereafter.
“This is very good news for the group...this extension will enable Paragon to continue its rapid exploration of the kimberlite with a view to completing the bulk sampling and moving towards a scoping study as quickly as possible,” said chairman of Paragon Francesco Scolaro.
“Along with our rapid development of the Motete Dyke system this gives us a great platform to develop into a Lesotho focused diamond producer.”
Shares in Paragon rose one percent to 21.25 pence this morning, valuing the group at £41.5 million.