Botswana Diamonds has secured a mining permit for its Thorny River project in Limpopo, South Africa, following extensive geological exploration suggesting promising conditions. The company may begin contractor mining pending market conditions and could resume operations at Marsfontein if diamond prices rise. Despite an early share price increase, the stock ultimately fell to 0.13p, with a market capitalization of £1.5 million.
Botswana Diamonds (LON: BOD) has obtained a mining permit for its Thorny River project, situated in South Africa’s Limpopo province, signaling the commencement of potential mining operations. This site, adjacent to the now-exhausted Marsfontein diamond mine, has been the subject of thorough geological assessments, encompassing geophysical studies, drilling, and bulk sampling, indicating promising geological characteristics and grades akin to those at the nearby Klipspringer mine.
Previously, Botswana Diamonds operated the Marsfontein gravels and dumps as a test mining operation, accruing a 15% revenue royalty from its activities. However, due to declining diamond prices and delays in permits, the Marsfontein site entered a state of maintenance in October 2023. With the new permit for Thorny River secured, the company plans to commence contractor mining, provided market conditions permit.
Should diamond prices improve, Botswana Diamonds might also reactivate operations at Marsfontein while simultaneously increasing production at Thorny River. Following this announcement, shares of Botswana Diamonds experienced an initial surge in early trading but ultimately dropped by 2.6% to a value of 0.13p in afternoon trading, resulting in a market capitalization of £1.5 million ($1.9 million).
Botswana Diamonds has secured essential mining permits for the Thorny River project, with exploration suggesting favorable conditions similar to nearby past-producing mines. The company is positioned to initiate contractor mining and may resume operations at Marsfontein if market conditions improve. Despite a temporary decline in share price after the announcement, the acquisition of the new permit represents a significant development in the company’s growth trajectory.
Original Source: www.mining.com
