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BOD Talks over CKGR explorations collapse

Publishing Date : 25 November, 2019

Author : ALFRED MASOKOLA

Botswana Stock Exchange (BSE) listed diamond exploration outfit, Botswana Diamond PLC has revealed in their annual results for the year ended June 2019 that talks with an undisclosed major global diamond mining company for further explorations and commercialization work in the Central Kalahari Game Reserve (CKGR) have hit a snag.


In a statement, the Company Chairman, John Teeling said work done by Botswana Diamonds on their 100% owned licenses contract continues to be focused on the Central Kalahari Game Reserve (CKGR). He explained that extensive geophysical and geochemical analysis was conducted in 2017 and 2018 which led to the identification of high priority targets.


FAILED PARTNERSHIP WITH ALROSA

Botswana Diamond which is also listed on the London Stock Exchange Alternative Investment Market (AIM) was until end of 2018 in partnership with Russian Diamond Mining powerhouse Alrosa for explorations in Kalahari and Orapa area through 50-50 Joint venture Sunland Minerals (Pty) Ltd. Sunland which is now under 100 % ownership of BOD presently holds 2 active Prospecting Licences (PLs) in the Orapa area, as well as 6 PLs in the Gope/CKGR (Kalahari) area. BOD became operators of the Sunland in the Kalahari region in early 2018. A number of high-grade geophysical anomalies were discovered by the company in the Kalahari region of Botswana.


Following the identification of these high-grade geophysical anomalies, heavy mineral sampling for kimberlitic indicators was undertaken on eight of the geophysical anomalies.  A total of 267 kimberlitic indicator minerals (“KIMs”) were discovered. All 8 anomalies had KIMs. The KIMs included 41 garnets, 13 chromites, 139 ilmenites, 4 chrome diopsides and 70 olivines.


An analysis of the grains by Remote Exploration Services of Cape Town concluded that the sources were likely to be local due to the abundance, size and fresh surface textures of the KIMs. Few months after Alrosa’s exit BOD announced that negotiations were at an advanced stage with a new joint venture partner though these could not be concluded until Alrosa had officially exited the Sunland.


NEW TALKS

Following Alrosa’s completed  exit out of Sunland  BOD announced in August this year that prospecting Licences PL232 and PL235, held by now its wholly -owned subsidiary Sunland Minerals (Pty) Limited  have been renewed for an additional two years to September 2021.
“These key licences, covering just over 500sq kms, are strategically located in the central Kalahari Desert west of the Ghaghoo diamond mine. Botswana Diamonds has already identified prospective drill ready targets.


The intensive work included aeromagnetic surveys, ground magnetic surveys, soil sampling and target selection,” the company said in the statement three months ago. “Analyses of concentrations of Kimberlitic Indicator Minerals on the licences indicate proximity to kimberlite pipes, which regional geology suggests may be attractive in size and grade,” Further revealed the company. In the same statement dated 22nd August 2019, BOD announced that it was in extended discussions with a major international diamond producer to joint venture the next phase of work on these strategic licenses.


However this week Botswana Diamond Chairman John Teeling revealed that the new talks with a potential replacement for Alrosa have also hit a not convincing stage. Teeling further noted that the BOD is scouting in the market to look for other alternatives in a bid to continue with the projects’ “Interest was shown by third parties to participate in the exploration of these targets. Agreement was reached with one large diamond producer but that has not come to fruition. In our view as the board it is unlikely to be finalized. Alternatives are being considered” he said.


GOVERNMENT STILL HOLDING ONTO MAIBWE –BCL SHARES


Still in the Kalahari diamonds fields Botswana Diamonds holds other prospecting license making a total of eight licenses in Botswana with applications lodged for a further six. The company holds a 15% net interest in the Maibwe joint venture in the Southern Kalahari.
BOD’s interest is held through Siseko Minerals, a South African company.BOD owns 51 % of the Siseko. Other partners in Maibwe are BCL at 51% and Future Minerals at 20%. BCL is a large state-owned copper nickel company which is in liquidation while future Minerals is a locally owned Botswana company.


Under the Maibwe Diamonds three-way original JV agreement, BCL was the operator and had to complete and fund an agreed work programme, whereas JV partners Future and Siseko have a free carry up to the Bankable Feasibility Study stage. The project came to a halt during 2016, due to BCL being unable to finance the agreed work programme, and subsequently BCL was placed under provisional liquidation.


The liquidator is in the process of completing a prospectus with a view to selling BCL’s 51% interest in the Maibwe project while BOD and the other partners have been developing alternative scenarios to move the project forward including an offer to acquire BCL’s share in the project at the cost of exploration. “With the prospectus being at an advanced stage, a commercial solution is now in sight,” said John Teeling.


To date the Maibwe JV has identified a cluster of four diamond bearing kimberlite pipes on PL186, with surface sizes of 5ha, 6ha, 2ha and 1ha respectively.  Significant quantities of microdiamonds have been found in one of these pipes. “Diamonds were discovered on the Maibwe licenses. The operator, BCL, was placed into liquidation prior to them completing the agreed exploration programme. We have made an offer to the liquidator to buy the BCL holding, we are told that the Botswana government wants more work done on the licenses before making a decision,” explained BOD Chairman.

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