25 May 2012

Diamondcorp seeks £5m

10/02/2010 Robert Tyerman

Gem miner Diamondcorp wants funds for its Lace mine in South Africa and cites a potentially significant find in Botswana.

Paul Loudon, the entrepreneurial Australian chief executive of AIM-quoted Diamondcorp, says the London-based company has not priced its mooted fund raising, most of which would go to complete developments to resume underground mining at the 74 per cent-owned Lace project. Diamondcorp says the Lace main diamond pipe contains an estimated 13.29 million carats at an average of 40.12 carats per hundred tonnes of rock and comments rough diamond prices have ‘recovered strongly’ since it last sold stones from Lace in July at $90 a carat.

Commenting that Lace was profitable even at the recent nadir of the gem market, Loudon says the company will now take samples from another project, at Jwaneng South in Botswana, where its initial programme ‘has discovered a large diamondiferous kimberlite’ [where gems can occur] at one target, J-01. He adds Diamondcorp has also outlined two more targets there ‘with the potential to host kimberlites with economic size potential’.

Loudon suggests these Botswana funds ‘could transform the company’. At a time when the diamond market is picking up after a particularly bleak period, investors must hope so, too.

Floated at 90p in 2007, Diamondcorp shares have fallen nearly 90 per cent to 9.5p since then, valuing the company at £4.5 million. Clearly carrying risk, they have speculative recovery potential for the brave.

Tags: AIM, Commodities, Fundraisings

Sector: Mining

Companies: Diamondcorp

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