THE DIAMOND PAGE — Diamond Fields, partners sign agreement

Few junior companies searching for diamonds outside North America have accomplished as much, within a relatively short time, as Diamond Fields Resources (TSE).

The company is headed by Jean-Raymond Boulle, who has 10 years of senior management experience with De Beers, including postings in Zaire, Antwerp and Sierra Leone.

The company has two modest-sized kimberlite diamond mines in the Kimberley district of South Africa, as well as other diamond exploration interests in Africa. More recently, Diamond Fields brought on a senior partner interested in developing its Luderitz concession off the west coast of Namibia. A definitive agreement was recently signed between Diamond Fields and BHP Minerals, together with BHP’s partner, Benguela Concessions. The agreement allows BHP and Benguela the right to earn a 50.1% interest in the deep-water portion of Diamond Fields’ 660-sq.-km. concession and up to a 50% interest in the shallow-water portion (fewer than 40 metres in depth).

“We are very pleased to have the (BHP-Benguela) joint venture involved in the project,” Boulle said. “We think it is a good combination.”

BHP and Benguela agreed to carry out exploration, sampling and bulk testing. If this work is successful, a feasibility study will be carried out to determine the viability of multi-year diamond mining to produce at least 100,000 carats per year, with a possible annual expansion to 200,000 carats. The cost of the exploration program and feasibility study is estimated at US$10 million, or more if required. If a green light for mining is given, BHP and Benguela will have earned a 50.1% interest, and each party thereafter will be responsible for funding its own share of further costs. Diamond Fields will transfer all its technical data to the joint venture, including data from a recent geophysical survey carried out by its vessel Diamond Seas. In addition, BHP intends to mobilize and dispatch its largest diamond exploration vessel, Geo-Master, to the sea concession. Elsewhere overseas

* In Botswana, Scintilore Explorations (TSE) and Fancamp Resources (ME) have acquired the Khutse property, which consists of 688,000 hectares of precious stone licences. With this acquisition, the partners now jointly hold more than 1.2 million hectares of precious stone licences in Botswana. Limited surface sampling by previous operators resulted in scattered recoveries of kimberlitic indicator minerals.

A systematic program of airborne magnetic surveys and surface sampling is scheduled to begin shortly.

* Partners Mountain Lake Resources (VSE) and South Cross Diamonds are discussing option terms on their Mooi River project in South Africa. (A recent issue of The Northern Miner incorrectly identified it as the Moon River project.)

* Pure Gold Resources (TSE) has entered an agreement with Southern Pacific Development to earn a 25% interest in the latter’s Colonel Murta project in Brazil’s Minas Gerais state. Southern Pacific holds an 80% interest in the project.

The 9,000-hectare property is along the Jequitinhonha River valley, which has a history of alluvial diamond production.

To earn its interest, Pure Gold has agreed to reimburse Southern Pacific US$51,000, which represents 25% of its costs to date. In addition, Pure Gold will issue Southern Pacific 100,000 shares and incur US$87,500 in expenditures.

A screening plant is being set up on the property to test gravels along a 20-km stretch of the river, the objective being to determine the average grade of the deposit.

* Four new kimberlites have been found on Reunion Mining’s holdings in Zimbabwe. These bring the number of kimberlites discovered in Zimbabwe to 20. Reunion is 32%-owned by Caledonia Mining (TSE).

* De Beers Consolidated Mines and De Beers Centenary AG have announced combined earnings of US$340 million for the six months ended June 30. This is a marginal decrease of 3% over the US$353 million reported for the same period last year. Following good first-half sales, diamond stocks decreased by US$95 million to US$4,029 million, compared with US$4,124 million at December 31, 1993.

* Namibian Minerals (VSE) has filed a final prospectus with the Namibian Stock Exchange for its initial listing and the raising of $30 million (Namibian dollars).

Simpson McKie, the sponsoring broker, has fixed the issue at 3.25 million shares at $9.25 (Namibian dollars), of which 2.25 million shares have been placed with southern African institutions, with the remainder being issued publicly in Namibia. The price is equivalent to about C$2.81 using the Financial Rand exchange rate, or C$3.55 at the Commercial Rand exchange rate. Proceeds from the issue will be used to fund bulk sampling on the company’s marine diamond concessions.

* Wide-diameter drilling has begun on Cliff Resources’ (TSE) Phillips Range diamond project in northwestern Australia. The holes are being drilled to delineate reserves on the north lobe of the Aries kimberlite pipe. Material collected from the drilling will be processed in the Phillips Range treatment plant, which has a capacity of 10 tonnes per day.

On the south lobe of the Aries pipe, where drilling has been under way for three months, two holes — AN34 and AN36A — have encountered micaceous kimberlite interspersed with basalt and sandstone breccia.

* Partners SouthernEra Resources (TSE), Leicester Diamond Mines (VSE) and Beckleigh Investments of South Africa have completed a review of their exploration project north of Kimberley, South Africa. Results of the bulk-sampling programs, although consistent in the recovery of high-quality diamonds, demonstrated that grades were insufficient to justify continuing the project.

Accordingly, the partners have notified the property owners of their intention not to exercise the option to purchase the concession. SouthernEra has also announced that exploration is continuing on its 75%-owned Kimberley East property. A drill program, designed to test four kimberlite indicator mineral anomalies, is expected to begin shortly. * The Sierra Leone government has issued an exclusive prospecting licence to Diamond Corporation Sierra Leone Ltd. (DCSL), a wholly owned subsidiary of De Beers. The licence covers a 15,800-sq.-km concession off the southern coastline of the West African country and is good for two years. Over nine months, DCSL will invest about $3 million to survey the seabed within the concession area. A further $10 million may be spent on sampling, depending on the results of the preliminary survey.

* New Privateer Mines (VSE) has agreed to buy Midas Minerals’ (TSE) 26.7% interest in the Casierra Development Fund, a company formed to develop alluvial diamond projects in Sierra Leone. The interest could increase to 41% if a production decision is made.

Under the deal, Midas will receive 23.6 million New Privateer shares, which represents 70% of New Privateer’s outstanding shares.

Saskatchewan

* Swannell Minerals (VSE) says 21 magnetic anomalies, thought to represent kimberlites, have been identified on its 364,230-hectare SDS diamond property. Preliminary interpretations suggest that the source of the magnetic anomalies is 100-150 metres below surface.

The property is held in conjunction with Golden News Resources (TSE), Calco Resources (VSE) and Guardian Resources, a unit of Guardian Enterprises (VSE).