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Paragon Diamonds (LON:PRG) said there is strong demand for the type of stones unearthed from the Lemphane kimberlite in Lesotho as it exported its latest and largest parcel unearthed as part of its ongoing evaluation of its flagship project.
Dispatched to Antwerp for assessment were 211.22 carats, bringing the running total exported to 310.44 for a grade of 1.87 carats per hundred tonnes. Among the latest batch is the 8.86 carat diamond recovered in May.
Paragon said it has now completed processing of all the major pit samples from Lemphane along with the first stage of drilling, which consisted of four holes to an average depth of 343 metres.
Separately, the group said approval process for a mining lease application is expected to be “concluded without further delay” following the submission of additional information on the environmental base line audit.
Chairman Martin Doyle said: "I remain very pleased with the steady progress that we are making on the ground at our flagship project, Lemphane.
“There is currently strong demand for the type of stones that are being produced from Lemphane and with current global market supply constraints this positions the company well to continue to the evaluation programme.
“I look forward to updating the market with the revised tonnage and volumetric report, in addition to progress on the mining licence application, which should be awarded shortly."
The company’s nominated adviser (nomad) and broker, Sanlem Securities, said: “Paragon is successfully moving Lemphane towards the feasibility stage, and data collected thus far suggests an ore body with similar characteristics to Gem Diamonds' Letseng deposit.
“These are low grade (c2-4cpht) deposits but yield very high value stones due to large average sizes and very high quality (mainly colour and clarity). Diamond prices have performed well over recent months and projects such as Lemphane, with potentially attractive economics in relatively safe jurisdictions, are rare.”
“The recovery of large stones as previously announced shows the potential for this project.”
Boutique natural resources house SP Angel added: “Good progress is being made at the project and we await the valuation on the two packages that have been sent to Antwerp.
Shares in Paragon were up 4.6% to 5.75p in lunch-time trading.