---ADDS SHARE PRICE, BROKER COMMENT---
Paragon Diamonds (LON:PRG) has completed the transactions that give it 80% of the Lemphane Kimberlite project, while the government of Lesotho owns the remaining 20%.
As reported last month, under the mining lease agreement awarded to Meso Diamonds for Lemphane, the Lesotho government was entitled to a 20% interest in Meso.
Meanwhile, local partner Matekane Mining now holds around 10.71% of Paragon shares following the sale of its stake in Meso back to Paragon.
Last week, the firm unveiled an independent report which confirmed the “exciting economic potential” of its Lemphane kimberlite pipe.
MSA Group, led by Dr Johannes Ferreira, compiled a size frequency and revenue modelling study to verify the company's in-house estimates – and in general results were better than expected.
They confirmed the pipe’s grade at two carats per hundred tonnes. Interestingly, the report, taken from 300 carats from bulk sampling, suggests that a 100 carat-plus diamond should be found for every million tonnes of ore mined.
It is expected that 12% of the stone will exceed nine carats, while the diamond values are put at anywhere between US$930 a carat and US$1,025 a carat.
Following the statement, broker Sanlam highlighted that the Lesotho government has a 30% interest in Gem Diamonds’ (LON:GEMD) Letseng project and a 25% interest in Lucara’s Mothae project.
Paragon shares dipped 7.79% to 3.55p.