Firestone in Joint Venture to explore Orapa Kimberlites

Staff Writer | Wednesday January 6, 2010 00:00

According to a statement, JSE-listed Tawana Resources has entered into a agreement with Firestone Diamonds over its kimberlite exploration and evaluation projects in Botswana.

Aim-listed Firestone can earn up to a 70 percent interest in any kimberlites in the prospecting licences controlled by Tawana by carrying the costs exploration up to and including an initial bulk sample in a specific kimberlite.

At that point, Tawana will have the option to fund its remaining 30 percent share of expenses going forward.If it decides not to, Firestone can earn another 15 percent by financing all further work up to and including a mine development decision on the kimberlite concerned.

The agreement is subject to the approval of the Minister of Minerals, Energy & Water Resources Ponatshego Kedikilwe.  Firestone, which also has operations in South Africa, is already the largest holder of mineral rights in Botswana's diamondiferous kimberlite fields, controlling over 25 000 km2 around the major Orapa and Jwaneng mines and the entire Tsabong kimberlite field.

'With Firestone's major project close to Tawana's project, Tawana now has the ability to access the infrastructure of Firestone to develop and exploit the economic potential of its kimberlites in the Orapa area quickly and at relatively low cost,' said Tawana chairperson Euan Luff.

'We are excited about the potential of our kimberlites in the Opara area, and look forward to updating our shareholders about the results of Firestone's initial review of the project in early 2010.'

The Orapa prospecting licence covers an area of 57 km2 in the Orapa kimberlite field and contains a cluster of eight kimberlites.

The largest of the kimberlites, BK24, is located 2,5 km from Debswana's Damtshaa Mine and 26 km from Firestone's BK11 kimberlite, which is expected to start commercial production in the second quarter of 2010.

The production plant at Aim-listed Firestone Diamonds' BK11 project, in the northern district , will ramp up to an output of 1,5-million tons a year by the third quarter of next year.

Recently Firestone  told shareholders in a statement that commercial production at BK11 would commence ahead of schedule in the second quarter of 2010.Firestone had expected to make a development decision on the project by the fourth quarter of this year, following a final bulk-sampling evaluation phase.

'Commencing development of a new mine at BK11 is a major milestone for Firestone Diamonds. The BK11 mine will give us a very solid foundation from which to further develop our exciting portfolio of projects and opportunities in Botswana.

With the projected shortfall in rough diamond supply expected to drive diamond prices higher in the coming years, we believe that the prospects for Firestone are extremely good,' Firestone CEO Philip Kenny commented.