TSX.V Symbol (DMI) / OTCQX Symbol (DMIFF)
KELOWNA, BC, Sept. 6, 2012 /CNW/ - Diamcor Mining Inc. (TSX-V.DMI / OTCQX-DMIFF) (the "Company") is pleased to provide an update on the ongoing commissioning and testing exercises underway at the Company's Krone-Endora at Venetia Project (the "Project"). As previously announced, these commissioning and testing exercises are designed to (i) evaluate operational efficiencies of the in-quarry screening equipment (ii) assess processing capacities and recovery parameters for the modular processing plant, and (iii) assist the Company in determining modifications required, if any, to enhance Project efficiencies/recoveries for the long-term. The exercises are also aimed at securing a suitable quantity of rough diamonds for preliminary sorting by the Company and its strategic alliance partner Tiffany & Co which should assist both parties' operational planning and to provide the primary data necessary for the establishment of a new and current average dollar per carat estimate for the Project's rough diamonds.
Rough Diamond Recoveries Update
Recoveries of rough diamonds from initial testing and commissioning exercises are a result of the combined processing of the concentrate material secured as part of the acquisition of the Project from De Beers Consolidated Mines Limited and the processing of new material in the +1mm to -10mm size fraction which has been screened from the lower-grade surface to 7 meter depth of the K1 area of the Project. As of August 31, 2012, the Company had processed through the modular plant approximately 7,831 total tons of screened material. As a result, the Company has recovered several thousand individual diamonds with a total combined weight, before acidizing, of approximately 1,214.86 carats. Of particular note, 85 individual rough diamonds with a combined weight of 154.30 carats have been recorded at 1.0 carat in size or larger. Below is a general summary of the rough diamonds of 1.0 carat or larger which have been recovered to date:
- 66 diamonds (total 88.29 carats) were between 1 and 2 carats in size
- 10 diamonds (total 24.47 carats) were between 2 and 3 carats in size
- 5 diamonds (total 18.47 carats) were between 3 and 4 carats in size
- 3 diamonds (total 13.24 carats) were between 4 and 5 carats in size
- 1 diamond of 9.83 carats was recovered
The Company is very encouraged by the quantities, size frequency distribution and initial quality assessment of the rough diamonds recovered during the commissioning phase to date given that the vast majority of the new material processed has been from the lower-grade upper areas of the Project which are being targeted for future mining. While these initial results are currently meeting or exceeding Company expectations, it should be noted that these testing recoveries do not form part of the initial NI43-101 Technical report filed by the Company on July 30, 2009, and no grade or quality determination is intended by the Company due to the nature and purpose of the processing of this material.
As noted above, the vast majority of material processed during testing and commissioning exercises to date have been only from the +1mm to -10mm size fraction, with all additional material in the +10mm to -28mm size fraction, and +28mm size fraction currently being stockpiled for later treatment. This material over 10mm in size consists of lightly calcretized or cemented material, as well as larger aggregate, which will require additional treatment in order to effectively liberate any rough diamonds contained in this material prior to processing. An overview of the Company's planned implementation of dry-scrubbing to enhance the recoveries from this material is explained in further detail in the quarrying and in-field screening update below.
Over the coming weeks, the testing and commissioning exercises will focus on the processing of material from the higher-grade lower depths of the K1 area of the Project. These exercises will test the processing plant's capabilities with these materials and will allow the Company to secure a proper representation of rough diamonds from these higher-grade lower gravels prior to the planned preliminary sorting and evaluation exercises.
Quarrying / In-field Screening Update
As part of the testing and commissioning exercises, the Company has performed preliminary reviews on the operational efficiencies of both the heavy equipment and the screening equipment deployed in the Project's quarry.
The quarrying operations are conducted through the use of various pieces of heavy equipment designed to extract material for screening and size classification prior to their transportation to the processing plant. Heavy equipment being used for quarrying currently consists of two Cat 966 front end loaders (one of which is utilized at the processing plant) with bucket capacities of approximately 4.0 cubic meters each, two tracked excavators in the 23 to 33 ton range, and four hard axle trucks with capacities of 10 cubic meters per load. During the testing and commissioning exercises to date, equipment capacities, cycle times and efficiencies are all meeting the Company's expectations. The Company believes that no additional heavy equipment will be required in the short-term to meet its initial targets.
Due to the high percentage of fine material identified in the deposit, the Company determined that the implementation of a mobile screening unit could enhance the Project's overall operational efficiencies, reduce operational costs per ton, and provide the added benefit of lowering the overall water consumption associated with final processing. In an effort to achieve these desired objectives, the Company announced that it had taken delivery of a Terex H6203 Powerscreen. The use of this equipment was aimed at dry-screening material in-field, with the desired operational objective of reducing the quantity of material to be hauled for processing by approximately 45% through the removal of very fine material under 1mm in size. The material in this -1mm size fraction is considered by the Company to be either non-diamond bearing or to contain only very low quantities of lesser value diamonds, and thus the Company considers the potential operational benefits to be significant.
Material processed through the Powerscreen is currently separated and categorized into four size fractions. Material under 1mm in size (targeted for removal), material between 1mm and 10mm in size, material between 10mm and 28mm in size, and oversized material greater than 28mm in size. During the initial testing and commissioning exercises performed to date, the screening unit has consistently demonstrated its ability to achieve the desired operational target of reducing material by 45% after a single pass through the unit. While the Company is pleased with the overall operation of the screening process, it also believes that it will be possible to achieve yet greater efficiencies in the removal of additional fine material in-field through the implementation of dry-scrubbing and additional screening equipment. To test this assumption, material was subjected to two passes through the Powerscreen unit, with the result being a further reduction in fine material of approximately 15-20%. The Company believes that this additional reduction in fine material is simply a result of the further breaking down of material due to handling. Therefore in order to enhance the overall in-field treatment of materials, and thus plant processing efficiency in the future, the Company plans to incorporate a dry-scrubbing process and additional screening into the initial treatment phase of all material at the quarry. This equipment will be aimed at better liberating all material prior to screening in order to enable the Powerscreen to operate more efficiently, enhance the overall production process, reduce costs, and possibly increase the recoverable grade through the processing plant in the long-term. Until such time as the dry-scrubbing equipment can be procured and installed, the Company will continue to stockpile all material over 10mm in size for later treatment.
Processing Plant Update
As part of the testing and commissioning performed to date on the processing plant, screened material was transported for processing through the plant's 16' bulk material reduction pans before reporting to a Dense Media Separation (DMS) plant and x-ray final recovery units, after which the final concentrate was passed over a secondary grease table. Testing on the operational efficiencies of both the pre-concentrating pans, and the DMS plant, have progressed as expected, with their operation meeting the Company's expectations. Evaluations on the modular plant's capabilities and its ability to support the Company's initial targeted production ramp of up to 10,000 carats per month within 12 months are also in line with Company expectations. The Company believes the implementation of dry-scrubbing and additional in-field screening will lead to the further removal of fine materials, thus allowing the existing processing plant to support increased production capacity over the long-term. The Company is also evaluating the merits of adding a crushing circuit and a third bulk material reduction pan; however, final decisions on the addition of these items will only be made once the implementation of the in-field dry-scrubbing and screening equipment is completed. The Company has made provisions during the planning, design and construction of the processing plant for these items to be easily added should they be warranted.
In addition to the evaluation of the pans and DMS plant, testing and evaluation exercises on the Project's containerized x-ray flow-sort final recovery units and secondary grease systems have also been completed. These units are meeting the Company's expectations and no modifications should be required in order to meet the Company's initial production targets.
Project Status Overview:
The extensive planning, development and construction of site infrastructure at Krone-Endora was successfully completed over a period of less than 18 months, which has positioned the Company to now further advance the development of the Project and pursue near-term production. Following the completion of the above-mentioned commissioning and testing exercises, the Company plans to focus on achieving targeted staged monthly operational increases through a move to trial mining in order to provide the Company with near-term production and cash flow. The Company anticipates that the move to full scale mining will coincide with the confirmation by the South African Department of Mineral Resources of the issuance of a mining right which has been applied for and is currently in process. In conjunction with the full scale mining exercises, the Company also plans to carry out a bulk sampling programme on new areas of the Project not previously accounted for in the initial NI 43-101 Technical Report filed by the Company as part of the acquisition process. These efforts are designed to support the future filing of an updated NI 43-101 Technical Report, and to assist Management when developing long-term production targets and decisions for the Project.
Strategic Tiffany & Co. Alliance:
As announced on March 29, 2011, the Company has established a long-term strategic alliance and first right of refusal with world famous New York based Tiffany & Co. to purchase up to 100% of the future production of rough diamonds (excluding Specials, individual stones of 10.8 carats or greater) from the Krone-Endora at Venetia Project at current prices to be determined by the parties on an ongoing basis. In conjunction with this right of first refusal, Tiffany & Co. also provided the Company with substantial financing to advance the Project as quickly as possible. Tiffany & Co. is a publically traded company which is listed on the New York Stock Exchange under the symbol TIF. Originally founded in 1837, the Tiffany's name is now globally recognised as one of the premier luxury jewellery and specialty retailers in the world. Through Tiffany & Co. and various other subsidiaries, the company is engaged in product design, manufacturing, and retailing activities on a global basis. As of April 30, 2012 Tiffany & Co. operated 251 stores and boutiques in the Americas, Japan, Asia-Pacific, and Europe and engages in direct selling through internet, catalog and business gift operations. For additional information on Tiffany & Co., please visit their website at www.tiffany.com.
About Krone-Endora at Venetia:
On February 28, 2011, Diamcor successfully acquired the Krone-Endora at Venetia Project from De Beers Consolidated Mines Limited, consisting of the prospecting rights over the farms Krone 104 and Endora 66, which represent a combined surface area of approximately 5,888 hectares directly adjacent to De Beers' flagship Venetia Diamond Mine in South Africa. De Beers previously completed various exploration efforts on initial areas of interest comprised of approximately 307 hectares, a summary of which was reported in an initial Independent NI 43-101 Technical Report filed by the Company on July 30, 2009. The deposits which occur on the properties of Krone and Endora have been identified as a rare, higher-grade "Alluvial" basal deposit which is covered by a lower-grade upper "Eluvial" deposit. The deposits are proposed to be the result of the direct-shift (in respect to the "Eluvial" deposit) and erosion (in respect to the "Alluvial" deposit) of an estimated combined 1,000 m (1 km) of material from the higher grounds of the adjacent Venetia Kimberlite areas. The deposits on Krone-Endora occur in two layers with an average total depth of less than 15.0 metres from surface to bedrock, allowing for a very low-cost mining operation to be employed with the potential for near-term diamond production from a known high-quality source. Krone-Endora also benefits from the significant development of infrastructure and services already in place due to its location directly adjacent to the Venetia Mine. Since acquiring Krone-Endora the Company has completed the construction and installation of extensive infrastructure at the Project, along with the installation of a purpose built modular processing plant. Commissioning of the processing plant is now underway, and the Company's current efforts are designed to be a continuation of the ongoing advancement of the Project.
About Diamcor Mining Inc:
Diamcor Mining Inc. is a fully reporting publically traded junior diamond mining company which is listed on the TSX Venture Exchange under the symbol V.DMI, and on the OTC QX International under the symbol DMIFF. The Company has a well-established operational and production history in South Africa, and extensive experience supplying rough diamonds to the world market. Rather than exposing itself to the high risks and costs associated with exploration, the Company's focus is on the identification, acquisition, and operation of unique diamond projects with near-term production potential such as the Krone-Endora at Venetia Project. For additional information on Diamcor, please visit our website at www.diamcormining.com.
Qualified Person Statement:
Mr. James P. Hawkins (BSc., P.Geo), is Manager of Exploration & Special Projects for Diamcor Mining Inc., and the Qualified Person in accordance with National Instrument 43-101 responsible for overseeing the execution of Diamcor's exploration programmes and a Member of the Association of Professional Engineers, Geologists, and Geophysicists of Alberta ("APEGGA"). Mr. Hawkins has reviewed this press release and approved of its contents.
On behalf of the Board of Directors
Mr. Dean H. Taylor
President & CEO
Diamcor Mining Inc.
Phone: (250) 864-3326
This press release contains certain forward-looking statements. While these forward-looking statements represent our best current judgement, they are subject to a variety of risks and uncertainties that are beyond the Company's ability to control or predict and which could cause actual events or results to differ materially from those anticipated in such forward-looking statements. Further, the Company expressly disclaims any obligation to update any forward looking statements. Accordingly, readers should not place undue reliance on forward-looking statements.
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SOURCE: Diamcor Mining Inc.
For further information:
Mr. Dean H. Taylor
President & CEO
Diamcor Mining Inc.
Phone: (250) 864-3326