| Thu 1 Mar 2007, 10:47 | | DMR - Diamond Core Resources Limited - General pro |
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DMR
DMR
DMR - Diamond Core Resources Limited - General progress report to shareholders
Diamond Core Resources Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/013468/06)
Share code: DMR ISIN Number: ZAE000076956
("Diamond Core" or "the company")
DIAMOND CORE RESOURCES LIMITED: GENERAL PROGRESS REPORT TO SHAREHOLDERS
This progress report supplements that which was previously released on SENS this
morning at 8h03.
Diamond Core Resources Limited ("the Company") is pleased to advise of the
progress made on projects within its portfolio, as well as provide a general
progress report regarding matters within the Company.
Commenting on the current status and general progress of the portfolio of
diamond projects being developed by the company, Theo Botoulas, CEO of the
Company stated that "The ability of the Company to conduct its own bulk sampling
programmes is a key part of the ongoing exploration process of systematically
searching for economically viable opportunities to bring into production, and
the Paardeberg East plant will be used to sample not only the Paardeberg East
kimberlites but all potential kimberlite targets in our immediate area of
interest. The Silverstreams bulk sampling/ trial mining facility is the first of
three plants planned for the Middle Orange River. The Company is fast
approaching the completion of the first phase of its growth path which is the
operationalisation of its assets."
For more information regarding the Paardeberg East and Silverstreams Project
Sites , please visit our website on www.diamondcore.co.za.
Milestones:
Paardeberg East
* Commissioning of the 50 tonne per hour DMS module and final recovery unit
at the Paardeberg East site;
* Completion of the dewatering operations in the PK1 pit;
* Mapping of the PK1 kimberlite body ongoing;
* Bulk sampling trenches in the Western Lobe drilled and blasted;
* Completion of the making safe of the Paardeberg East PK1 pit;
* Re-commissioning of the water pipeline used for abstracting water from the
Vaal River, some 18 km west of the Paardeberg East site;
* Completion of the plant water recovery facilities at the Paardeberg East
site;
* In excess of 150 000 tonnes of kimberlite excavated from the PK1 pit during
the making safe operations stockpiled onto the sampling pads;
* Paardeberg East centralised logistics and stores facilities completed for
utilisation through the group;
* Continuation of exploration activities and identification of targets for
drilling and further geological work on the project area;
Silverstreams
* Infrastructural development 90 percent completed, including roads, offices,
and a water pipeline of approximately 2 kilometres from the Orange River to the
plant site;
* 50 tph re-concentration DMS plant erected;
* 16 ft rotary pan plant infrastructure nearing completion;
* Three of the four rotary pan plants for Silverstreams completed, with all
four scheduled for delivery to site during the first week of March;
* Infill drilling on channel feature ongoing: trenches sited by Group
Geologist;
* Infill drilling has confirmed previous work done by the Company;
* Excavation of two trenches commenced: Rooikoppie gravels stockpiled and
calcrete exposed for drilling and blasting;
* Company security deployed to secure assets;
* Offices and administrative infrastructure in place;
* Exploration for primary deposits commences with soil sampling programme by
MSA Geoservices over the property.
Other
* A total of 2 Mining Rights and 7 Prospecting Rights covering 106 761
hectares have been issued to the Group
* Review and planning for the Uitdraai and De Kalk alluvial exploration sites
continues;
* Ongoing exploration on primary targets in the Company portfolio, in
particular Skeyfontein and Kuiltjespan;
* Continued implementation and integration of the Company into the fabric of
the Northern Cape via numerous BEE initiatives;
* Continuation of infrastructure and services development in support of the
operational function and the creation of administrative functions ranging from
financial controls to IT.
* Appointment of a consultant to complete the Company Kimberley Process and
Chain of Custody documentation in co-operation with Company Security Officials,
as well as to audit the bulk sampling plants and bulk sampling operations.
Projects
The projects are detailed in order of operational priority, as:
* Paardeberg East kimberlite project which is held in Diamond Core Mining and
Exploration (Pty) Limited, a 100 percent held subsidiary of the Company. The
Company will commission the bulk sampling plant during March 2007.
* Silverstreams alluvial project, held in Sandstraat Eksplorasie (Edms) Bpk,
a 50 percent held subsidiary. The objective is to commission this project by the
end of April 2007.
* Uitdraai alluvial project which is owned via a 50 percent subsidiary
Prieska Diamond Mining (Pty) Limited. Construction of this project will commence
during the second quarter of 2007, once the two projects detailed above have
been commissioned
* De Kalk alluvial project held in Samadi (Douglas) Exploration (Pty)
Limited, a 50 percent held subsidiary. Construction of this project will
commence once the first two projects detailed above have been commissioned,
during the second quarter of 2007.
* The Skeyfontein kimberlite project held by Dikeing Mining (Pty) Limited, a
50 percent held subsidiary, on which some additional exploration work will be
done.
* The "blue sky" projects housed in both DCR Kimberlite and Alluvial Projects
(Pty) Limited, as well as Samadi Exploration (Pty) Limited, will be implemented
by way of a parallel strategy to the above projects with a budgeted R 1,5
million for initial work. This includes Silverstreams kimberlite exploration,
the Koa Valley Project and Kuiltjespan, on which SENS announcements have been
made previously.
CORPORATE GOVERNANCE AND SECURITY
Kimberley Process: Chain of Custody and Diamond Control
The services of an independent diamond consultant, Mr Ramon Ferraris of QTS-
Kristal Dinamika, have been retained to audit the bulk sampling plants and bulk
sampling process on both the Paardeberg East and Silverstreams sites.
Mr Ferraris, working in conjunction with the Company Security Officials, has
been mandated to design and develop a Chain of Custody process for Company
diamond production, as well as to design an effective diamond control process.
This process has been initiated and will be constructed in a manner and fashion
which will strive for compliance with international best practice and the
requirements of the Kimberley Process. Mr. Ferraris is responsible for auditing
this process as well as for providing technical expertise with regards to the
diamond product.
Mr. Ferraris has 30 years experience in the rough diamond industry, including
working for both De Beers and RTZ.
GEOLOGY
Paardeberg East
Mapping of the Western Lobe of the PK1 Pipe has been 80 percent completed. Two
kimberlite facies have been identified in the Western Lobe, whilst in the
Eastern Lobe of the PK1 Pipe a third facies has been identified. Mapping of the
Eastern Lobe has commenced as the floor area has been cleared both of slimes
post the dewatering, as well as debris from a previous sidewall failure. The
positions of the two bulk samples planned for the Western Lobe have been marked
out, drilled, blasted and are ready for bulk sampling.
Trenching at the PK3 site some 3 kilometres to the West is planned for the
second quarter of 2007. The purpose of the trenching operation is to correlate
the kimberlite:country rock contacts with the drill results, observe and record
the nature of the overburden, and to determine the included waste content of the
kimberlite. The trenching will assist the Group Geologist with the positioning
of the planned bulk sampling trenches.
Silverstreams
Alluvial exploration
During January 2007, 91 percussion boreholes, totalling 919 metres, were drilled
on a 100 by 50m grid over a previously identified channel feature at
Silverstreams. Further detailed infill drilling is planned for the second
quarter over potential trap sites in the channel feature. The infill drilling
has confirmed the results of the previous drilling undertaken by the Company.
The first two bulk sampling trenches have been placed diagonally across parts of
the channel feature. The first of the two trenches include well developed upper
gravels, whilst the second trench has well developed basal gravels. Both
trenches have a Rooikoppie gravel component which will be sampled separately.
Kimberlite exploration
A stream sediment sampling exercise covering the northern part of the
Silverstreams property was carried out by MSA Geoservices during December 2006.
The recovery of potential kimberlitic indicator minerals from samples collected
is underway, and depending on the results of this soil sampling programme which
will be reported in due course, further greenfields exploration work for primary
kimberlite targets might be undertaken at Silverstreams. The presence of a
number of diamondiferous fissures and kimberlitic occurrences on the 1:250 000
scaled geological map of the area have warranted the kimberlite exploration
programme over the northern part of the Silverstreams property.
Skeyfontein
A pitting and trenching programme was initiated at the beginning of February
2007 over a number of photo-geological linear features which were previously
sampled and which delivered a positive result with respect to kimberlite
indicator minerals. The property is known to host at least one diamondiferous
kimberlite fissure.
New Business
The Company continues to review new Projects on an ongoing basis and will only
make acquisitions of these Projects fit the Company strategy and philosophy and
are value accretive to our shareholders.
OPERATIONS
Paardeberg East
To date the Project has been implemented in three distinct but parallel phases:
Phase 1
Making-safe the PK 1 pit and establishing a level pit floor surface for accurate
mapping and bulk sampling operations.
The making safe of the pit was completed on the Western Lobe of the PK1 Pit in
December 2006. The Eastern Lobe has been made safe and will be ready for bulk
sampling/ trial mining to commence by the end of March 2007. The tonnage removed
during the benching operations has exceeded the estimates in the Hatch plan for
a safe working pit, but the Project remains within the budget estimate. The
removal of the excess tonnage was necessitated by the extremely poor condition
of the pit sidewall which was observed after excavation and making safe
operations had commenced and the upper bench had been excavated.
The pit was made safe by utilising a Volvo fleet that consisted of ten A35
ADT`s, one EC 700 Excavator, two EC 460 Excavators, a B25 Water Bowser and a 375
Komatsu Dozer. Bulk sampling will be conducted in accordance with the plan laid
out by the Group Geologist.
The major portion of this earthmoving fleet will be deployed to the
Silverstreams site in preparation for the bulk sampling/ trial mining of the
alluvial gravels during the first week of March 2007.
Phase 2
Constructing and erecting of a Bateman 50 tonne per hour (tph) Dense Medium
Separation (DMS) unit and final recovery (including x-ray machines and a sort
house)
Commissioning of the 50 tph Bateman DMS Module, which was purchased from the
Simolotse Mine (Pty) Limited, and the final recovery unit commenced on the 20th
November 2006 using old plant tailings. This commissioning of the plant was
successfully completed on 15 December 2006. A total of 45 stones weighing 14,53
carats was recovered from approximately 400 tonnes of tailings (throughput was
determined by means of belt cuts while awaiting delivery of weightometers). The
recovery included a diamond weighing 6.25 carats which is of good quality.
These recoveries are not statistically relevant as the process was not audited
and no secondary and tertiary crushing circuits were operational which would
have ensured optimal diamond liberation. The tailings treated will be
reprocessed once the front end is operational.
Phase 3
Design, manufacture and construction of the front-end
This phase of the project was contracted to CDM Group (Pty) Ltd. To date the
late delivery of portions of the front end as well as minor design modifications
have resulted in a delayed commissioning of the front-end. It is expected that
the metallurgical plant will be ready to commence with bulk sampling operations
by the end of March 2007.
Design, manufacture and construction of the crushing circuit and automated
grease belts
Bateman Modular Plants have been contracted to design, manufacture and construct
a turnkey secondary automated grease belt diamond recovery system to complement
the 50 tph dense medium separation (DMS) plant. The grease belt system will be
installed and commissioned on 9 March 2007. The final recovery consists of a
primary section with two Flow Sort X-Ray Machines, a secondary section with an
attritioner, two Bateman GB 800 grease belts and a hands-off Sort House.
The front-end with secondary and tertiary crushing circuits will be commissioned
in mid March 2007, and bulk sampling operations at Paardeberg East are planned
to commence on during the latter half of March 2007.
The Company has a total of 34 people permanently employed on Paardeberg East.
Silverstreams
At Silverstreams the plant layout is complete and the construction of the Civils
Works is underway.
The first two sampling trenches have been marked out by the Group Geologist and
the "rooikoppie" has been cleared and stockpiled in order to expose the calcrete
layer for drilling and blasting. Drilling of in excess of 1 000 shotholes to a
depth of 4 metres commenced on the 19th February 2007 and will be completed by
the first week in March.
The plant, which previously consisted of a front end capacity of 150 tonnes per
hour, has been re-designed to comprise a 670 tph trommel screen, a magnetic
separation section to remove banded ironstone, and four 16 foot rotary pan
plants feeding into a Bateman 50 tph DMS re-concentration plant. The final
recovery unit consists of a primary section with four Flow Sort x-ray machines,
a secondary section with two Bateman GB 1000 and one GB 800 automatic grease
belts, and a hands-off Sort House. The capital spend for the project has
increased by some 14 percent for the re-designed layout, with an increase in
front end capacity in excess of 400 percent.
The planned commissioning date for the Silverstreams metallurgical plant is the
middle of April 2007, and bulk sampling operations are expected to commence by
the beginning of May 2007.
HUMAN RESOURCES AND ADMINISTRATION
The Company strategy for 2007 is to align all Human Resources and Administrative
Policies and Procedures with the strategic business plan and relevant
legislative requirements.
The Group`s Human Resource Policies and Procedures have been finalised and are
in the process of being implemented.
The Company has recently conducted a skills data base road show in the labour
sending areas surrounding our projects in the Northern Cape, to determine the
skills base available to the Company, for the roll out of all future and
existing projects. The initiative was supported by all Local Municipalities in
areas in which the Company operates.
The Accpac mining module, which will significantly enhance the Company`s
financial control process, has been successfully installed and is operational
throughout the Group.
For further information or enquiries, please contact Theo Botoulas on
+(27)828522150 or on +(27)117064888.
1st March 2007
Epsom Downs
Sandton
Sponsor
River Group
Date: 01/03/2007 10:47:00 Produced by the JSE SENS Department.
