JOHANNESBURG (miningweekly.com) – Diamond explorer Botswana Diamonds continued to advance second-phase exploration on three of its joint venture (JV) blocks in the Orapa area of Botswana, telling shareholders on Friday that the diamond industry continues to “glisten” in a resource sector depressed by weak demand.

Chairperson John Teeling noted in a statement that exploration was focused on potential drill sites identified in the 2014 exploration campaign that had the potential to plug a “clear” diamond supply-demand gap currently emerging in the global market.

“Demand for gemstones in Asia, the Middle East and parts of Africa is growing due to an emerging middle class. The forecast demand-supply gap begins in 2017 and, by 2023, could be as much as 100-million carats a year or as low as 34-million carats a year. 

“The strong demand for diamond jewellery is not being met by discoveries, as there have been no major discoveries since 2005. The result of these factors is likely to be stronger prices in the future,” he outlined in an interim results statement for the six months ended December 31.

JV PROJECTS
Teeling added than an initial analysis of the group’s JV project with major diamond producer Alrosa in the Orapa diamond field had identified several prospective targets.

An exploration programme, which began in September 2014 and would run through this year, had yielded “several thousand” kimberlite indicator mineral concentrate samples that had been sent for analysis.

“We expect results to follow in June. The joint programme is fully funded to the third quarter,” he said.

He added that, in the past year, the JV had started to look at potential targets outside of the Orapa area, while continuing to identify new ground of geological potential within the original area. The JV had applied for and had been awarded additional ground in the area. 

“Ground has been applied for in other areas which, for competitive reasons, we will not identify. We are also in negotiations for future farm-in arrangements with various holders on ground identified by the JV, which is held by others,” he commented.

Botswana Diamonds meanwhile retained an option to acquire an up to 95% interest in the 13-licence Brightstone block in the Gope region of the Kalahari.

Teeling outlined that a large base metals producer that had recently entered the diamond sector had become the operator of the block and had already established an on-the-ground exploration team .

Botswana Diamonds had contributed much of its Gope area data bank to the new company in return for a 15% free carry through all phases of exploration up to the completion of a bankable feasibility study. 

“This is a good deal for all parties concerned, as it brings fresh eyes and ideas to the block. Outside of the JV, the Botswana Diamonds team has continued to work on our own data and has proposals on some of our existing ground and interesting ideas on new areas,” he noted.

Botswana Diamonds posted an interim loss of £149 000 0.08p a share.