DFI Proceeds Diamond Campaign Off Namibia
- Business & Finance
Diamond Fields International (DFI ) has announced a restart of offshore marine operations on its Namibian concessions in a joint venture with International Mining and Dredging South Africa (IMD), a subsidiary of International Mining and Dredging Holdings, Limited (IMDH) and an associate company of Nutam of Namibia.
Pursuant to an agreement between DFI’s Namibian subsidiary Diamond Fields Namibia (DFN) and IMD, DFN and IMD have begun a four-stage development program of DFN’s mining concessions ML-138, ML-139 and ML-111. The program will ascertain the grade and size of diamond deposits, the available quality and diamond carat sizes, the nature of the overburden, the soils and the hard layer, and the economic and technical considerations for undertaking mining activities in the concession areas.
The first stage consists of deploying a survey vessel, The DP Star, to complete geophysical surveys in the concession areas. The second stage will use a sampling vessel to complete reconnaissance sampling of targets identified by the geophysical study. The third stage involves a sampling vessel to complete regional/bulk sampling and a preliminary resources assessment and preparation of a mining plan. Should results from the first three stages warrant it, the parties will enter into the fourth stage, consisting of finalizing a mining plan and deploying a mining vessel to carry out mining.
The program initially will focus on identifying potential new resource areas, in particular buried palaeo-channel systems which are known to occur within the concessions, but have not previously been evaluated due to the technicalities of exploiting these. The joint venture will utilize state-of-the-art sub-sea crawler systems that can excavate up to 17 metres of substrate, making these previously unavailable targets accessible. The first stage will be comprised of a multi-sensor geophysical survey of the concessions to map and evaluate the extent of the palaeo-channel systems, and extend previous geophysical coverage.
IMD will bear all the costs of the program through completion of the third stage. In exchange, it will receive representation on DFN’s Board and earn an increasing percentage of ownership interest in DFN as it successfully completes each stage.
While IMD may suspend operations during any stage, it must complete each stage by a certain date in order to receive a certain percentage interest in DFN. Upon successfully completing the following stages, IMD will earn the following interests: 20% for stage 1; an additional 30% for stage 2; and a further 25% for stage 3 plus the right to appoint a majority of the directors on the joint entity company’s board. If the parties proceed to stage 4 mining, IMD will receive a final additional 5% for a total of 80% interest.
The Namibian Government has approved joint operations between DFN and IMD late on June 3, 2015. Stage 1 operations will begin with immediate effect.
Further to this, DFN has filed its application for renewal of ML-111, which license expires December 4, 2015. Further development of ML-111 after that date is subject to approval of DFN’s renewal application pending with the Government of Namibia.
Sybrand van der Spuy, DFI’s CEO, said: “These are exciting times for DFI. Getting back onto the water is a major milestone which the Company has worked towards for years. We have targeted a number of resource areas, with special interest in the palaeo-channel systems, that we intend to work up in the coming months with the intent of mining should results warrant.”