West African Diamonds PLC (AIM: WAD) announced an agreement with Pyramid Resources, a private Sierra Leone company, to reopen the Plant 11 tailings project near Koidu, for which WAD has a 5 percent royalty on production.
Pyramid, formed by local WAD advisers and management, has taken over the mining lease and certain plant and equipment. They will focus on recovering diamonds contained in the 7 million ton diamond tailing dump.
WAD chairman John Teeling commented: “The WAD project on Plant 11 focused on gold and diamond recovery using a new technology. The new owners will concentrate on recovering diamonds followed by gold recovery. This initiative is good for all, our former workers who get jobs, the local area which gets income, and the state which will get revenue and exports.”
In mid-September 2009, the company announced an agreement with privately owned Japanese developer Thunderball Ltd to form a joint venture for developing its secondary Koidu project. The joint venture will provide WAD with the opportunity to explore the previously neglected Koidu license while still maintaining investment in their primary development, the Bomboko project in Guinea.
West African Diamonds own the license at Koidu and under the terms of this new joint venture they will retain 20 percent of the project going forward, Thunderball will be the project operator and major shareholder, Thunderball will begin an intensive exploration of the licence.
Thunderball are mandated to explore in and around the diamondiferous Pipe 3 kimberlite, part of a 26 square kilometre licence, which also includes kimberlite dykes containing high grades of quality diamonds. Should the subsequent exploration results justify the development of a mine, Thunderball will also take the operator role under the joint venture, West African Diamonds will be carried for all expenditure until a mine is fully developed and production has commenced.