West African Diamonds PLC (AIM: WAD) was lifted in early trades by news that the equipment for the full scale plant at its Bomboko alluvial gold mine in Guinea is on site and is currently being commissioned.
The cost of commissioning will be met from the sale of gold mining equipment in Sierra Leone and from diamond revenue. This will take production from 10 tonnes to 80 tonnes an hour on a three shifts per day basis. Current operating costs of US$7.50 a tonne is targeted to fall to US$5.00 a tonne with full production. The group started production in April with a smaller-scale pan plant and excavator than are being commissioned at present.
Shares in the diamond group were trading up 6.25 percent in early deals on the news.
To date, a total of 261.6 carats have been produced at Bomboko from 4,200 tonnes of gravel, giving a grade of 6.2 carats per hundred tonnes. Visual observation indicates that 60 percent of the stones are gem quality and includes three stones weighing 9.71, 7.52 and 5.26 carats.
The diamonds will not be sold until there is an adequate parcel to get a representative value but, historically, gemstones from the Bomboko are of good quality and obtain good prices, the company said.
During the current wet season, a stockpile of 10,000 tonnes of gravel will be used to feed the pan plant. Once the larger plant is operational the current, smaller plant will be used as a prospector unit ahead of the main plant.
Drilling is ongoing at Droujba to test the anomalies discovered from the detailed ground geophysics undertaken by West African Diamonds. Bulk sampling will commence when the current drilling programme concludes.
Deputy chairman James Campbell said: “Our Bomboko mine came on stream as scheduled and within cost. We are pleased with the grade and quality of diamonds being discovered. All equipment necessary to expand to 30,000 tonnes a month throughput is on site and being commissioned.”