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Lemphane Kimberlite Project
NI 43-101 Independent Technical Report on the Lemphane
Kimberlite Project, Lesotho
Prepared by MSA Geoservices (Pty) Ltd on behalf of:
Meso Diamonds
Authors: Frieder Reichhardt Principal Consultant
Mike Lynn
Senior Project Manager
MSc, PhD, Pri.Sci.Nat.
BSc (Hons), MSc, GSSA
th
Date:
28 October 2010
Project:
J1952
Primary Author
Dr Frieder Reichhardt
Lemphane Project
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NI 43-101 Report – 28 October 2010
Supervising Principal
Dr Ian Haddon
Page: i
Table of Contents
1
SUMMARY........................................................................................................................ 1
1.1 Property, Location and Ownership ........................................................................... 1
1.2 Exploration Concept ................................................................................................. 1
1.3 Status of Exploration ................................................................................................ 2
1.4 Conclusions and Recommendations ........................................................................ 2
2
INTRODUCTION AND TERMS OF REFERENCE............................................................. 4
2.1 Scope of Work ......................................................................................................... 4
2.2 Currency................................................................................................................... 4
2.3 Principal Sources of Information............................................................................... 4
2.4 Current Personal Inspection ..................................................................................... 5
2.5 Qualifications, Experience and Independence.......................................................... 5
3
RELIANCE ON OTHER EXPERTS ................................................................................... 7
4
PROPERTY DESCRIPTION AND LOCATION.................................................................. 8
4.1 Area and Demarcation of Licence ............................................................................ 8
4.2 Surface Rights.......................................................................................................... 9
4.3 Issuer’s Interest........................................................................................................ 9
4.4 Mining Rights and Royalties in Lesotho.................................................................. 10
4.5 Environmental Liabilities......................................................................................... 10
4.6 Permits................................................................................................................... 11
5
ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND
PHYSIOGRAPHY............................................................................................................ 12
5.1 The Kingdom of Lesotho ........................................................................................ 12
5.2 Access ................................................................................................................... 12
5.3 Ecology and Climate .............................................................................................. 13
5.4 Local Resources and Infrastructure........................................................................ 14
6
HISTORY ........................................................................................................................ 16
7
GEOLOGICAL SETTING ................................................................................................ 18
7.1 Regional Geology................................................................................................... 18
7.2 Local Geology ........................................................................................................ 21
7.3 Kimberlite Geology ................................................................................................. 22
8
DEPOSIT TYPE .............................................................................................................. 26
9
MINERALISATION.......................................................................................................... 28
10
EXPLORATION............................................................................................................... 31
10.1 Exploration approach and methodology ................................................................. 31
10.2 Grab Sampling ....................................................................................................... 31
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10.2.1 Grab Sampling Results ............................................................................... 33
10.3 Geophysical Surveys.............................................................................................. 34
11
DRILLING ....................................................................................................................... 38
12
SAMPLING METHOD AND APPROACH........................................................................ 39
13
SAMPLE PREPARATION, ANALYSES AND SECURITY............................................... 40
13.1 Kimberlitic Indicator Mineral Sample Analysis ........................................................ 40
13.2 Caustic Fusion Total Liberation Diamond Content Sample Analysis....................... 40
14
DATA VERIFICATION..................................................................................................... 43
14.1 Kimberlitic Indicator Mineral Samples..................................................................... 43
14.2 Caustic Fusion Total Liberation Diamond Content Samples ................................... 43
15
ADJACENT PROPERTIES ............................................................................................. 44
15.1 Letseng Diamonds ................................................................................................. 45
15.2 Mothae Diamond Project ........................................................................................ 47
15.3 Kao Project............................................................................................................. 48
15.4 Liqhobong Project .................................................................................................. 51
16
MINERAL PROCESSING AND METALLURGICAL TESTING........................................ 52
17
MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES................................... 53
18
OTHER RELEVANT INFORMATION .............................................................................. 54
18.1 Diamond Market ..................................................................................................... 54
19
INTERPRETATION AND CONCLUSIONS...................................................................... 57
19.1 Project Risks and Opportunities ............................................................................. 58
20
RECOMMENDATIONS ................................................................................................... 59
20.1 Phase I Evaluation Programme .............................................................................. 59
20.1.1 Phase I Evaluation Sampling Plant ............................................................. 60
20.2 Phase II Evaluation Programme ............................................................................. 62
20.3 Work Programme Budgets..................................................................................... 62
21
REFERENCES ................................................................................................................ 63
22
DATE AND SIGNATURE PAGE...................................................................................... 65
23
CERTIFICATES............................................................................................................... 66
24
GLOSSARY OF TECHNICAL TERMS............................................................................ 68
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List of Tables
Table 4-1 Coordinates of PL 005
8
Table 6-1 Available historical artisanal production records from Lemphane
17
Table 7-1 Heavy Mineral Concentrates from the Lemphane Main and Satellite Pipes
24
Table 10-1 List of samples collected over the Lemphane Kimberlite
32
Table 10-2 Total Liberation by Caustic Fusion Sampling Results
33
Table 10-3 Heavy Mineral Stream Sampling Visual Sorting Results
33
Table 12-1 Sampling methodology
39
Table 15-1 Letseng Mine (source Gem Diamonds Annual Report 2009)
45
Table 15-2 Mothae Project
47
Table 15-3 Kao Project
49
Table 15-4 Liqhobong Project (± 6 km E of Lemphane)
51
Table 19-1 Summary of Project Risks
58
Table 20-1 Exploration Budget (Phases I and II)
62
List of Figures
Figure 4-1 Locality map of the Lemphane Kimberlite Project
9
Figure 5-1 Access route to the Lemphane Project
13
Figure 5-2 Infrastructure Map of Lesotho
14
Figure 7-1 Tectonic Setting of the Lemphane Kimberlite Project
18
Figure 7-2 Stratigraphy of the Lemphane Project Area (units shown as per Figure 7-3)
19
Figure 7-3 Geological Map of Lesotho and the Northern Lesotho kimberlite Field
20
Figure 7-4 Section through the Karoo Basin from Lesotho to the coast in South Africa
21
Figure 7-5 Remote view of the Lemphane kimberlite pipe looking southeast and showing the
approximate pipe outline.
22
Figure 7-6 Top left: Macrocrystic garnet and ilmenite-bearing volcaniclastic(?) kimberlite.
Bottom left: Eastern contact looking north with near vertical basalt wall rocks. Top right:
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Bedded crater facies (?) kimberlite draped over a basalt xenolith (ZAR 5 coin for scale).
Bottom right: Xenolith-rich volcaniclastic(?) kimberlite.
23
Figure 7-7 Geology of the Main Lemphane Kimberlite Pipe
25
Figure 9-1 Artisanal miners at Lemphane
28
Figure 9-2 Top left: Pit sunk by artisanals through slumped (non-kimberlite) material and soil
cover to access the eluvial lag on the upper surface of the kimberlite. Depth approximately
6m. Bottom left: Screening and hand concentrating of excavated material. Top right:
Screened and hand concentrated material. Bottom right: Hand sorting the concentrate. 29
Figure 10-1 Samples localities, superimposed on the geophysical interpretation of the pipe
32
Figure 10-2 Ground magnetic survey results. Total magnetic field with survey lines (top) and
interpretation overlain on an image of the 1st vertical derivative (bottom)
35
Figure 10-3 Comparison of the geophysical interpretation with the geological map of Kresten
(1973)
37
Figure 15-1 Northern Lesotho Kimberlite cluster
44
Figure 15-2 Panoramic View of Letseng Mine
46
Figure 15-3 Geological Model of the Mothae Kimberlite. The pipe is approximately 700m long 48
Figure 15-4 Geological Model of the Kao kimberlite main pipe. The pipe is approximately 750m
across (NE-SE)
50
Figure 18-1 Rough diamond supply vs demand forecast pre-global financial crisis
54
Figure 18-2 Rough and polished diamond prices 2002 to September 2010
56
Figure 20-1 Evaluation Programme
59
Figure 20-2 Phase I Sampling plant and mass balance
61
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1
SUMMARY
1.1 Property, Location and Ownership
Meso Diamonds (Pty) Ltd (‘Meso’) has commissioned The MSA group (‘MSA’) to prepare
an Independent Technical Report on the company’s Lemphane Kimberlite Project in the
Kingdom of Lesotho (Lesotho). This report on the Lemphane Kimberlite Project is to
comply with disclosure and reporting requirements set forth in the TSX - Venture
Exchange (TSX – V) Corporate Finance Manual, National Instrument 43-101, Companion
Policy 43-101CP, and Form 43-101F1.
Meso holds a Prospecting Licence totalling some 6.33 km2 in the Maluti Mountains of
Lesotho in southern Africa. The geology of Lesotho is dominated by the basaltic
Drakensberg Group lavas (187 Ma to 155 Ma) of the Karoo Supergroup. These rocks
comprise an impressive range of high plateau mountains. Underlying the basalts in the
western lowlands is a thick sequence of clastic sediments. These rocks do not outcrop in
the mountains but may appear as country rock inclusions in the numerous Cretaceousage kimberlite pipes that have been discovered in northern Lesotho. The current erosion
level in the Lesotho highlands places the original emplacement surface of these
kimberlites a few hundreds of metres above the present surface at Lemphane, the
kimberlite that is the subject of this report. Observation of the kimberlite suggests that the
current erosion level is near the boundary between the original volcanic crater and the
kimberlite diatreme below.
The Lemphane kimberlite was discovered in the 1950s and received cursory early
economic evaluation by Jack Scott. A grade of between 1-2 cpht was achieved from
limited sampling. In the context of the economics of the time these grades militated
against further development. No systematic evaluation work has been conducted on the
pipe since this time. The kimberlite is approximately oval in shape. It has a surface area
of 6.4 ha and occupies a bowl-shaped depression on the flanks of a high ridge at an
elevation of approximately 2 600 m. The occurrence of diamonds is demonstrated by the
presence of artisanal diggers on surface and has been confirmed by recent total liberation
diamond content sampling of the kimberlite by Meso. However, the grade, revenue and
diamond character has not yet been determined.
1.2 Exploration Concept
The Lemphane exploration model favours a Letseng- or Mothae-like diamond value and
grade for the kimberlite. This requires that a high value, low grade diamond deposit will
be demonstrated, and the exploration work programme that has been planned reflects
this model. The Letseng Diamond Mine is an adjacent property currently in production at
a rate of 7.5 Mt per year (2009). Letseng diamond grade is a very low 1.2 ct/100t, but the
extraordinary value of USD1 534/ct (2009) complements this to provide an ore value of
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NI 43-101 Technical Report – 28 October 2010
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USD28/t. with a reported operating cost of USD12/t. Mothae has a higher grade of
4.7cpht (based on bulk sampling data) and modelled stone values of $549/ct. It is
currently undergoing trial mining to determine economic viability. A 53.5 ct white gem
quality diamond (Type II) was reported very early during the trial mining programme.
The aggressive two year programme at Lemphane has been designed to test this model.
1.3 Status of Exploration
The exploration and evaluation programme envisages the establishment of a geological
model through the acquisition of new geological and geophysical data.
A high-resolution ground magnetic survey has been completed, which delineated the
kimberlite pipe boundary and identified possible internal kimberlite facies variations. Total
liberation diamond content sampling of surface outcrops and a stream sediment sample
has recovered diamonds that will be tested to determine the presence of Type IIa stones
and which have potential revenue implications.
The positive results from this work have prompted the decision to move on to a Phase I
evaluation programme. Surface pitting will provide material to characterise kimberlite
facies and determine diamond potential by assessing kimberlitic indicator minerals from
mineral chemical analyses. Further total liberation diamond content sampling will be
undertaken to investigate diamond content and size frequency per phase. A recovery
plant has been commissioned to recover +1.8 to -40 mm diamonds from the excavated
material to provide additional size and potential revenue information.
If the results of Phase I are favourable, the project will continue with Phase II evaluation
work. This would involve ongoing processing of material to obtain a sufficiently large
parcel of diamonds to provide a preliminary estimate of diamond content per kimberlite
phase. Upon favourable completion of the bulk sampling programme, a 3 000 to 5 000 m
core drilling programme would be completed to determine a geological model with
volumes, densities and modelled grades of the kimberlite facies so that a mineral
resource can be defined.
1.4 Conclusions and Recommendations
An aggressive programme to evaluate the diamond potential of the Lemphane kimberlite
pipe has commenced. Geophysical and geological field surveys have delineated the
surface extent of the kimberlite body (6.4 ha). A conceptual 30 Mt to 200 m depth may be
visualised.
Geophysical and surface geological mapping has identified lithological variations within
the pipe and the first qualitative indication of diamond potential has been interpreted from
total liberation diamond content analyses.
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The current erosion level exposes possible diatreme and volcaniclastic kimberlite as a
major lithologies which would imply that limited erosion of the pipe has occurred. There
may be important lithological variations that could have significant economic implications.
Certain risks and opportunities have been identified for the project. These include
environmental, technical and community risks which Meso are being proactive in
managing. The proximity of other projects in the exploration, development, and mining
stage may also provide opportunities for certain synergies.
The evaluation strategy is based on a Letseng-, and Mothae-like model and a pitting
programme is being designed to test this model. Meso is committed to a specific work
programme in terms of its Prospecting Licence. The outcome of the full programme will
be the mapping of the surface geology of the pipe, and the recovery of sufficient
diamonds to be valued. The breakdown of this programme and the costs are shown in
Table 20-1 and the total planned cost is GBP 1.27 million over the 24 month period to
June 2012. MSA considers that the proposed exploration strategy is consistent with the
potential of the project and that the proposed schedules are achievable. Similarly, MSA
considers that the committed tenure expenditure is consistent with the proposed
programme and will prove adequate to meet these minimum expenditure requirements.
The following points suggest that Lemphane must be regarded as a target of some
potential:
•
Availability of grid power
•
The occurrence of high value diamonds based on historical artisanal mining data
•
The occurrence of high value Type IIa diamonds on adjacent properties, suggesting
that there is potential at Lemphane for similar high value diamonds
•
So far a total of 19 diamonds have been recovered by Meso, all but one of which are
reported as white in colour.
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2
INTRODUCTION AND TERMS OF REFERENCE
2.1 Scope of Work
The MSA Group (“MSA”) has been commissioned by Meso Diamonds (Pty) Ltd (“Meso”)
to provide an independent technical report (“ITR”) on the Lemphane Project focused on
the Lemphane kimberlite pipe in Lesotho, in which Meso holds a 100% interest. This ITR
has been prepared to comply with disclosure and reporting requirements set forth in the
TSX Venture Exchange (TSX-V) Corporate Finance Manual, Canadian National
Instrument 43-101 (Standards of Disclosure for Mineral Projects) and related Companion
Policy 43-101CP and Form 43-101F1, of January 2005 (the Instrument) and the Mineral
Resource and Reserve classifications adopted by CIM Council in August 2000. This
report may be included in future equity financing plans by Meso to fund exploration work
for the Lemphane Project.
2.2 Currency
All monetary figures expressed in this report are in British Pounds (GBP) unless
otherwise stated. The Lesotho currency is the Maluti (M) which is on par with, and tied to
the South African Rand (ZAR). On the effective date of this report, the exchange rates
are GBP 1 = ZAR 10.89 = M 10.89 and USD 1 = ZAR 6.77 = M 6.77.
2.3 Principal Sources of Information
MSA has based its review of the Lemphane Project on information provided by Meso,
along with technical reports by Government of the Kingdom of Lesotho (“GKL”) agencies
and other relevant published data. A listing of the principal sources of information is
included in the References section at the end of this ITR. Previous drafts of the report
were provided to Meso, along with a written request to identify any material errors or
omissions prior to lodgement.
The Lemphane Project is considered to represent a “Mineral Project”. Economic viability
has not been demonstrated by a Feasibility Study. However, an exploration programme is
proposed which will involve pitting, and consequently the Lemphane property is
considered to have passed beyond the definition of “Early Stage Exploration property” as
that term is defined in the rules and policies governing disclosure.
This ITR has been prepared on information available up to and including 28th October
2010.
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2.4 Current Personal Inspection
A site visit was made on 9th October 2010 to the Lemphane Project in Lesotho by Dr.
Frieder Reichhardt MSc, PhD, a ‘qualified person’ as that term is defined in NI43-101, and
Mr. Mike Lynn MSc, a geologist with 24 years experience in diamond exploration,
accompanied by Mr. Roy Spencer, a representative of Meso. A visit was made to the
surface outcrop of the kimberlite and the presence of kimberlite and active artisanal
workings was verified.
2.5 Qualifications, Experience and Independence
MSA is an exploration and resource consulting and contracting firm which has been
providing services and advice to the international mineral industry and financial
institutions since 1983. This ITR has been compiled by Dr Frieder Reichhardt and Mr
Mike Lynn.
Dr Frieder Reichhardt is a professional geologist with 21 years experience, including
diamond exploration management for Rio Tinto leading to the discovery and evaluation of
the Murowa kimberlite diamond mine in Zimbabwe. He is Principal Consultant diamonds,
nickel, PGE, vanadium and chrome with MSA, a member of the Geological Societies of
South Africa and Germany and a registered Professional Natural Scientist with the South
African Council for Natural Scientific Professions. Dr Reichhardt has the appropriate
relevant qualifications, experience, competence and independence to act as a ‘qualified
person’ as that term is defined in NI43-101. Dr. Reichhardt’s certificate as a ‘qualified
person’ is attached in Section 23 of this ITR.
Mike Lynn is a professional geologist with 25 years experience, primarily in the
exploration for and evaluation of diamond deposits in Southern, Central, West and East
Africa and India. He is a member of the Geological Societies of South Africa and India,
and of the Society of Economic Geologists. He is not yet registered as a Professional
Natural Scientist with the South African Council for Natural Scientific Professions, and as
such is not authorised to act as a “qualified person’ as that term is defined in NI43-101.
His contributions to this ITR have been signed off by Dr Frieder Reichhardt.
Peer review has been undertaken by Dr Ian Haddon, who is a professional geologist with
over 15 years experience, initially with the Council for Geoscience in South Africa and
more recently with MSA. Dr Haddon is Manager, Group Operations for MSA, with overall
responsibility for exploration, evaluation and environmental contracting and consulting
service offerings of the Group. He is a registered professional natural scientist with the
South African Council for Natural Scientific Professions.
Neither MSA, nor the authors of this ITR, have or have had previously, any material
interest in Meso or the mineral properties in which Meso has an interest. Our relationship
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with Meso is solely one of professional association between client and independent
consultant. This ITR is prepared in return for professional fees based upon agreed
commercial rates and the payment of these fees is in no way contingent on the results of
this ITR.
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3
RELIANCE ON OTHER EXPERTS
MSA assumed that all of the information and technical documents reviewed and listed in
the “References” are accurate and complete in all material aspects. While MSA carefully
reviewed all of this information, MSA has not concluded any extensive independent
investigation to verify their accuracy and completeness.
MSA has obtained a copy of Prospecting License No 005, in the name of Meso Diamonds
(Pty) Ltd, and signed by Mr Monyane Moleleki the Honourable Minister of Natural
Resources in the Kingdom of Lesotho, as evidence that the licence is valid and in good
standing.
The information and conclusions contained herein are based on information available to
MSA at the time of preparation of this report.
Meso has warranted that a full disclosure of all material information in its possession or
control has been made to MSA. Meso has agreed that neither it nor its associates will
make any claim against MSA to recover any loss or damage suffered as a result of MSA’s
reliance upon the information provided by Meso for use in preparation of this report.
Meso has also indemnified MSA against any claim arising out of the assignment to
prepare this report, except where the claim arises as a result of proved wilful misconduct
or negligence on the part of MSA. This indemnity is also applied to any consequential
extension of work through queries, questions, public hearings or additional work required
arising from MSA’s performance of the engagement.
Meso has reviewed draft copies of this report for factual errors. Any changes made as a
result of these reviews did not involve any alteration to the conclusions made. Hence the
statements and opinions expressed in this document are given in good faith and in the
belief that such statements and opinions are not false and misleading at the date of this
report.
MSA reserves the right to, but will not be obligated to, revise this report and conclusions
thereto if additional information becomes known to MSA subsequent to the date of this
report.
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4
PROPERTY DESCRIPTION AND LOCATION
The property is PL 005 issued in terms of Section 22 of the Mines and Minerals Act No 4
of 2005, and covering 6.33 km2 in the Butha-Buthe District of Lesotho. The licence is in
northern Lesotho, 29 km west of the Letseng diamond mine, centred on approximately
28° 35' 00" E / 28° 56' 35" S.
PL 005 is held by Meso, a company incorporated in Lesotho. It was issued on 1st June
2010. It is valid for 2 years and gives the right to undertake diamond exploration activities
in terms of the act.
4.1 Area and Demarcation of Licence
The corner points of PL 005 are given in Table 4-1.
Table 4-1
Coordinates of PL 005
Datum WGS84, Area = 6.33 km2
Point
Latitude (S)
A
B
C
D
E
F
28° 55' 54.8"
28° 55' 54.8"
28° 57' 24.5"
28° 57' 24.1"
28° 56' 53.9"
28° 56' 53.9"
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Longitude (E)
28° 33' 57.6"
28° 35' 32.6"
28° 35' 32.6"
28° 34' 27.5"
28° 34' 27.5"
28° 33' 57.6"
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Figure 4-1
Locality map of the Lemphane Kimberlite Project
Background imagery from Google Earth
4.2 Surface Rights
The surface area of PL 005 is communal agricultural land. A ‘kraal’ on the kimberlite is
used by the local community for summer grazing and is required to be removed by the
community on demand by Meso.
4.3 Issuer’s Interest
Meso is a Private Limited Company incorporated in Lesotho in terms of the Companies
Act (Act No. 25 of 1967). The Lemphane Project is 100% owned and funded by Meso.
Should the project develop to the mining stage, the Government has the right to take a
share of the project. The Government’s share, and proportion of any free carry is
negotiable.
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4.4 Mining Rights and Royalties in Lesotho
According to the Mines and Minerals Act No 4 of 2005, all rights to minerals are vested in
the Basotho Nation. Mineral rights may only be granted to a Lesotho-registered company
(or Lesotho nationals).
Exploration work is performed under a Prospecting Licence (PL) with a maximum area of
2
25 km , and which is valid for two years and renewable for one year. The renewal may be
extended at the discretion of the Minister if proper evaluation work is being undertaken.
There is no automatic right to convert a PL to a Mining Lease (ML), although the record
indicates that the Ministry of Mines has not unreasonably withheld this transfer in the
past. A ML is issued for a maximum of 10 years, and is renewable for a further 10 years.
The GKL retains the right to negotiate with a company regarding its shareholding, and all
technical, commercial and financial aspects of a diamond mining operation, before
issuing a ML.
A royalty is payable to the government of 10% for precious stones and 3% for other
minerals. This percentage is based upon the gross sale value receivable at the mine
gate, and in the case of diamond projects, is negotiable.
4.5 Environmental Liabilities
MSA is not aware of any current environmental liabilities on the Lemphane Project.
The holders of mineral rights are required to compensate surface owners for the use
and/or damage to their properties as a result of the mining activities. With respect to
environmental issues, the Act stipulates that the holder of a mineral right shall:
1. Preserve the natural environment;
2. Minimise and control waste or undue loss of or damage to natural and biological
resources;
3. Prevent and where unavoidable, promptly treat pollution and contamination of
the environment;
4. Restore the land substantially to the condition in which it was prior to the
commencement of operations; and,
5. Make ongoing financial provision for compliance with his (environmental)
obligations.
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The Mining Department requires that an Environmental Impact Assessment (‘EIA’) and an
Environmental Management Programme Report (‘EMPR’) be submitted prior to
commencement of mining operations.
Since artisanal mining activity has occurred on the Lemphane kimberlite pipe, there is a
risk that Meso could inherit liability for the environmental damage caused. Meso has
mitigated this risk by recording the pre-existing activity prior to commencing its own
exploration activities. A thorough record of pre-existing infrastructure and mining activities
has been prepared by Amathemba Environmental Management Consulting cc, a Cape
Town-based company.
The Khoabeng stream which drains the kimberlite, flows into the Malibomatsu River,
which in turn flows into the Khatse Dam some 17 km to the south. This dam provides
water for hydro-electric power and export to South Africa, and a management plan will be
required to mitigate the risk of slimes from the project entering the dam.
4.6 Permits
Other than the PL and work permits for foreign nationals, limited permitting is required to
undertake exploration activities. Removal of samples for analysis requires written
permission from the local Commissioner of Mine and Geology. A water use permit is
required from the Department of Water Affairs to use surface water for domestic and
process requirements if a camp is erected.
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5
ACCESSIBILITY, CLIMATE, LOCAL RESOURCES,
INFRASTRUCTURE AND PHYSIOGRAPHY
5.1 The Kingdom of Lesotho
Previously known as Basutoland, the Kingdom of Lesotho is a small, mountainous
landlocked country entirely surrounded by the Republic of South Africa. It has an area of
30 355km2, and a population of 1.9 million (July 2010 estimate by Central Intelligence
Agency World Fact Book) with a life expectancy estimate of 50 years and a median age
of 22 years. The literacy rate is the second highest in Africa, with 85% of the population
over 15 years able to read and write. Lesotho gained independence from Britain in 1966.
Lesotho is a parliamentary constitutional monarchy. King Letsie III has no executive or
legislative power but is considered to be a "living symbol of national unity". According to
the constitution, the Head of Government is the leader of the majority party in the
assembly.
Following a period of political unrest between 1990 and 1998, the political and social
environment is stable. In May 2002, the ruling Lesotho Congress for Democracy
(''LCOD'') won parliamentary elections which were endorsed by international observers,
and Rt. Hon. Prime Minister Pakalitha Mosisili was sworn-in for a second term.
Lesotho is a low-income country with an economy linked to South Africa. In the recent
past, Basotho men worked in the South African mining industry, but this source of
employment has dwindled, and the consequent loss of remittances has impacted the
economy. Lesotho’s main natural resource is water. Completion of a major hydropower
facility, the Lesotho Highlands Water Project (LHWP) in January 1998 now permits the
sale of water to South Africa, generating significant revenue for the country. Lesotho is
self-sufficient in electrical power for two-thirds of the year, but the country imports
electricity from South Africa during the winter.
5.2 Access
The property is accessed from Maseru via a tarred road to Leribe (+/- 93 km) and another
tarred road to Ha Lejone (+/- 59 km), and then a gravel road to the village of Lemphane
(+/- 30 km). From the village, there is a track to the pipe (2.1 km). The track is driveable
part of the way, and there is a plan to upgrade the track to provide access for pit
sampling.
The international airport at Maseru is linked to the major hub of Oliver Tambo Airport in
Johannebsurg. The drive from Johannesburg to Maseru takes approximately 6 hours.
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Figure 5-1
Access route to the Lemphane Project
Elevation data from ASTER (30m resolution)
5.3 Ecology and Climate
The landscape of Lesotho is divided into two major regions; the lowlands, which make up
less than 20% of the country, and occupy a narrow strip along the western edge of the
country at an elevation below approximately 1 800 m, and the highlands, which rise to
their highest point at Thabana Ntlenyana (3 476 m).
The Lemphane Property is located at an elevation of approximately 2,600 m in the
northern highlands of Lesotho (Figure 4-1). The terrain is mountainous with deeply
incised valleys. The vegetation is classified as Lesotho Highland Basalt Grassland,
consisting of grasses with minor shrubs (especially Passerina Montana and Chrysocoma
ciliate) and localised marshes known as Lesotho Mires, which act as water reservoirs.
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These vegetation types are classified as ‘Least Threatened’ but are ‘Poorly Protected’
(Mucina and Rutherford, 2006). There is no crop farming at this altitude.
The climate is temperate, moderated by the altitude. There is a cool, dry, winter from
March to October, and a milder and wetter summer during the remaining months.
Temperatures as low as minus 15°C may be experience d in the winter nights and daytime
temperatures in the summer are as high as 30°C. The climate would not normally impede
mining operations, which can continue year round.
5.4 Local Resources and Infrastructure
The road infrastructure in the area is limited. Good tar roads traverse the highlands to the
north and south of the project area, but access between these is by moderately
maintained gravel roads.
Figure 5-2
Infrastructure Map of Lesotho
Elevation data from ASTER (30m resolution)
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The electricity power grid is connected to the Eskom (the South African national electricity
supply company) power grid in South Africa. Major power lines pass approximately 20 km
to the north and southwest of Lemphane (Figure 5-2).
The area has a history of diamond mining dating to the late 1950s when a number of
kimberlite discoveries were declared government diggings. Currently one diamond mine
is operational (Letseng), another two are under development with trial mining in progress
(Mothae and Kao), and a fourth is the subject of an ongoing feasibility study (Liqhobong).
The Letseng Mine lies 29 km from Lemphane and obtains process water from an existing
dam located on the mine’s property. All rain water run-off generated on site, is diverted
into this dam, in addition to return water from the slimes dam and from open pit
dewatering. The dam also supplies the potable water treatment plant with raw water.
Electricity is supplied from the Lesotho national grid. A high voltage line was constructed
specifically to supply the mine. Back-up electricity is ensured through a series of diesel
generators.
The majority of mine employees at Letseng are resident on site during their shift cycle in
a series of accommodation units. Site services (cleaning, catering, etc.) are outsourced.
Due to the relative remoteness of the operation, an onsite sewage treatment plant,
domestic and industrial waste separation facility and incinerator are utilized to manage
waste.
At the Liqhobong Project, some 6 km east of Lemphane, power is provided on site by
large diesel generators. MSA understands that preliminary approval and funding has
recently been reported to build a 28 km-long connection to the national grid along the
valley of the Malibomatso River to provide power to the Liqhobong and Lemphane
Projects. The connection would be built as a development project and would take two
years to complete. Construction has not yet started. Water for domestic and process use
is currently obtained from surface streams.
No study has yet been undertaken on supply of power or water for the Lemphane Project.
However, it is likely that the project would utilize diesel generators and surface stream
water during the exploration phase. The PL permits the erection of a camp on site.
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6
HISTORY
Kimberlites were first recorded in the area by Stockley (1947). Geological mapping by
Leeds University researchers and a Lesotho-wide exploration programme by Basutoland
Diamonds Limited (BDL) added to the number of known kimberlites between 1957 and
1963. These programmes brought the number of known kimberlite pipes and dykes in the
country to 135, the most important of which were the Letseng-la-Terai (“Letseng”)
kimberlites (the Main and Satellite pipes), Kao, Liqhobong, and Lemphane. These pipes
were declared government diggings, and by 1967 there were up to 6 000 local diggers on
site at Letseng and the Letseng pipes are estimated to have produced 63 000 carats
between 1959 and 1967, including the 601-carat Lesotho Brown diamond.
Rio Tinto Exploration (Pty) Ltd was awarded the exploration license for the Letseng pipes
in 1968 and was tasked with undertaking a feasibility study to mine. Although grades of
the Letseng pipes were found to be low (less than 4 ct/100t), many large high-quality
stones were recovered. Rio Tinto abandoned the deposit in 1972, because of the low
grade and associated economics at the time which militated against further development.
Lesotho's government then asked De Beers to re-evaluate the Letseng kimberlites, which
lead to the opening of the Letseng Mine in November 1977. The mine was closed after 5
years in 1982 having produced 272 840 carats, from 9.4 Mt of kimberlite (mostly from the
Main pipe) at an average grade of 2.9 ct/100t.
Lesotho's government investigated ways to reopen the Letseng Mine in the 1990s.
Letseng Diamonds (Pty) Ltd (a Lesotho-registered company) was formed in 1995 as a
partnership between industry investors (76 percent) and the Lesotho Government (24
percent). The mining rights for the Letseng Mine were acquired by Letseng Diamonds
(Pty) Ltd in 1999. The reconstruction of the mine's infrastructure commenced in 2003,
and production at two alluvial deposits associated with the Main and Satellite Pipes
started in November 2003. Production at the Satellite Pipe resumed in March 2004.
The Lemphane kimberlite was discovered as part of the BDL exploration programme and
was evaluated in the late 1950s and early 1960s. Details of this work are unavailable, but
the pipe was abandoned because the economics of the time militated against further
development. Nevertheless, artisanal workings have continued intermittently on the
kimberlite. Records for artisanal production are incomplete, but some figures from 1978
to 1980 have been obtained from the Lesotho Department of Mines and are reported in
Table 6-1. This work was supported by the Canadian International Development Agency
(CIDA).
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Table 6-1
Available historical artisanal production records from Lemphane
(Source: GKL Ministry of Mines artisanal production records)
Period
Tonnes
Carats
Processed Produced
Average
Grade
Total
Stones
Cts/stone
Revenue
(Maluti/ct)
1978 (3 months)
719
22
3.1 cpht
85
0.26
M 201/ct
1979 (12 months)
7 590
166
2.2 cpht
581
0.29
M 188/ct
June 1980
13 425
256
1.9 cpht
863
0.30
M 260/ct
Totals
21 734
444
2.0
1 529
0.29
M 230/ct
Available artisanal production figures from Lemphane between 1978 and 1980 show
production of 444 carats at an average grade of 2.0 cpht, an average revenue of M 230/ct
(USD 277/ct* in dollars of the day), and an average stone size of 0.29 ct per stone.
During the same period, production from Liqhobong (combined figures from the satellite
and main pipes) totaled 8 216 carats with an average revenue of M 147/ct (USD 177/ct*
in dollars of the day) and approximately the same average stone size of 0.29 ct per stone.
Details of the recovery methods are unknown. Nevertheless, the implication is that the
diamond revenue from Lemphane may be significantly higher than at Liqhobong. This
data, along with anecdotal information, is the basis for the hypothesis that Lemphane may
be a low grade, high revenue deposit.
*The Rand Monetary Area (RMA) existed at this time and the
Maluti was tied at parity to the South African Rand. The average
Maluti/Rand to the USD exchange rate for the years 1978 to 1980
(inclusive) was 0.8303 and this figure is the basis for the
calculation of the revenue per carat in dollars of the day.
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7
GEOLOGICAL SETTING
7.1 Regional Geology
Lesotho is situated on the southern edge of the Kaapvaal Craton, which extends through
central, eastern and north-eastern South Africa, into southern Zimbabwe and southeastern Botswana, and incorporates most of Swaziland (Figure 7-1). The Kaapvaal
Craton is host to numerous important diamondiferous kimberlites of various ages,
including the Mesoproterozoic Premier kimberlite (Cullinan Mine), the Cambrian Venetia
kimberlites, the Middle Triassic Jwaneng kimberlites, and the Cretaceous Kimberley, and
Finsch kimberlites.
Figure 7-1
Tectonic Setting of the Lemphane Kimberlite Project
(Domain nomenclature after Eglington et al. 2009)
The geological history and structure of the Kaapvaal Craton have been discussed by
various authors (see for example de Wit et al., 1992, James et al., 2001, Begg et al.,
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2009, Eglington et al., 2009, Jones et al, 2009). The Northern Lesotho Kimberlite Cluster
lies on the Swaziland Terrane of Eglington et al. (op. cit.). The basement rocks are not
exposed in Lesotho, but further to the southeast in the Kwazulu Natal Province of South
Africa, the basement sequence includes the Archaean Natal granite greenstone terrane
(3.4 to 3.2 Ga). De Wit et al. (1992) suggest that the Swaziland Terrane and
Witwatersrand Terrane to the north had combined and stabilised by about 3.2 Ga during
the formation of the Kaapvaal Craton. The diamondiferous Northern Lesotho Kimberlite
Field therefore conforms to ‘Clifford’s Rule’ which states that diamondiferous kimberlites
tend to occur in geologic regions that have been tectonically stable since the Archaean
(Clifford, 1966).
Figure 7-2
Stratigraphy of the Lemphane Project Area (units shown as per Figure 7-3)
Supergroup
Cretaceous
Period /
Eon
Intrusives
Group
Subgroup
Formation
Lesotho
Kimberlites
Lithology
Kimberlite
Permian
Karoo
Dolerite Suite
Karoo Supergroup
Triassic
Jurassic
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Unconformity~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Drakensberg
Gp
Flood basalts and intrusive dolerite dykes
and sills
Clarens Fm
Elliot Fm
Molteno Fm
Stormberg
Gp
Beaufort
Gp
Ecca
Gp
Fine grained aeolian sandstone
Limestone, mudstone and sandstone
Sandstone
Tarkastad
Sbgp
Sandstone, red mudstone
Adelaide Sbgp
Mudstone, shale, sandstone
Madzaringwe Fm
Pietermaritzburg Fm
Sandstone, siltsone, shale
Shale, siltsone
Dwyka
Diamictite, shale
Gp
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Unconformity~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Archaean
Gneiss, amphibolite
The Archaean basement in Lesotho is entirely covered by the flat-lying Palaeozoic to
Mesozoic Karoo Supergroup which reaches a thickness of approximately 4 km in Lesotho
(Figures 7-2, 7-3 and 7-4). Its strata, mostly shales and sandstones, record an almost
continuous sequence of marine glacial to terrestrial deposition from the Late
Carboniferous to the Early Jurassic, a period of about 100 Ma. These accumulated in the
main Karoo Basin, which has been interpreted as a retroarc foreland basin formed by the
subduction and orogenesis along the southern boundary of Gondwana (Catuneanu et al,
2005).
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Figure 7-3
Geological Map of Lesotho and the Northern Lesotho kimberlite Field
The basalts of the Drakensberg Group were erupted within a very short period at about
180 Ma (Jurassic Period) and consist of a monotonous pile of compound basalt lava flows
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which lacks significant palaeosols or persistent sedimentary intercalations. Geochemical
analysis by Marsh et al. (1997) demonstrates that the stratigraphic sequence in Lesotho
closely resembles that in a thinner sequence of basalts some 400 km to the north. This in
turn indicates the widespread nature of the Karoo continental flood basalt event.
Figure 7-4
Section through the Karoo Basin from Lesotho to the coast in South Africa
(modified after Brown et al. 2002)
Kimberlite emplacement during the Cretaceous Period was widespread throughout
southern Africa, and was probably associated with tectonic triggers during the break-up of
Gondwana (Bailey, 1992).
7.2 Local Geology
Although the entire Karoo sequence has been intersected in boreholes, no stratigraphy
beneath the Beaufort Group outcrops in Lesotho. The geology of northern Lesotho
comprises sediments of the upper Karoo Supergroup, (Molteno, Elliot and Clarens
Formations) in the western lowlands, overlain by the basaltic lavas of the Drakensberg
Group which form the Lesotho Highlands. The sediments and, to a lesser extent, the
lavas are extensively intruded by dykes and sills of dolerite which decrease in frequency
upwards in the succession. Minor normal faulting is present in these sediments and lavas.
The base of the lava sequence lies at an elevation of approximately 1,600 m.
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The youngest structural trend in Lesotho is dominantly WNW and is manifested by
regional faults, zones of fracturing and brecciation, and jointing. Kimberlite dykes and
pipes are localized in portions of these regional structures (Figure 7-3).
7.3 Kimberlite Geology
The geology of the Lemphane kimberlites is described by Kresten (1973; Figure 7-5). The
main Lemphane pipe is oval in shape and covers an area of approximately 6 ha. The
contacts between the kimberlite and basalt country rocks appear sharp and nearly
vertical. A number of different kimberlite phases are observed in outcrop, and at least five
separate intrusions are inferred from a recent ground magnetic survey (Section 10.2).
The outcropping kimberlite is dominantly greenish or light grey, with abundant olivine
macrocrysts in a fine serpentinized matrix. The different phases observed vary primarily in
the abundance and size of xenoliths and olivine macrocrysts, as well as the abundance of
ilmenite and garnet. Some poorly defined bedding is apparent in some areas, which dips
towards the centre of the pipe. This implies that some crater facies material is preserved
at Lemphane, and is consistent with a model of limited erosion of the pipe having
occurred.
Figure 7-5
Remote view of the Lemphane kimberlite pipe looking southeast and showing the
approximate pipe outline.
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Xenoliths of basalt are common and range up to over one metre across in outcrop.
Xenoliths of basement rock (predominantly biotite gneiss) also occur. Kresten (op. cit.)
reports two mantle-derived xenoliths; one lherzolite and one harzburgite.
Kresten describes a small ‘satellite’ pipe which occurs on the western margin of the main
pipe, measuring just 12m x 17 m in outcrop. This is connected to the main pipe and is
better described as an apophysis that comprises a different kimberlite phase. The contact
is not exposed, but the kimberlite is greyish green and contains a greater abundance of
ilmenite and garnet xenocrysts than the main pipe.
Figure 7-6
Top left: Macrocrystic garnet and ilmenite-bearing volcaniclastic(?) kimberlite. Bottom left:
Eastern contact looking north with near vertical basalt wall rocks. Top right: Bedded crater
facies (?) kimberlite draped over a basalt xenolith (ZAR 5 coin for scale). Bottom right:
Xenolith-rich volcaniclastic(?) kimberlite.
At least one kimberlite dyke occurs which trends WNW. It appears to pre-date the main
pipe, and may be connected to the apophysis.
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Heavy mineral abundances were estimated from the main pipe and apophysis (‘satellite’)
and are reported by Kresten (op. cit.; Table 7-1).
Table 7-1
Heavy Mineral Concentrates from the Lemphane Main and Satellite Pipes
(source: Kresten, 1973)
LOCATION
Main Pipe, northern contact
Main Pipe, southern contact
Main Pipe, central part
Apophysis (‘Satellite’) Pipe, centre
% ilmenite
% garnet
%olivine/pyroxene
11.6
14.5
7.4
74.6
3.8
2.9
0.3
13.1
84.6
82.6
92.3
12.3
Overburden varies from zero to 10m thick and is thickest at the centre of the main pipe.
The following superficial sequence is observed:
-
Organic layer
-
Grey gravel
-
Grey soil
-
Brown oxidised gravel
-
Eluvial kimberlite lag enriched in ilmenite
-
Yellow oxidised kimberlite
The kimberlite lag is enriched in ilmenite and is likely to carry an elevated diamond grade.
It is being targeted by artisanal diggers. The steep slope across the surface of the
kimberlite has enabled slumping of kimberlite to occur from southeast to northwest
through secondary weathering and erosion processes.
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Figure 7-7
Geology of the Main Lemphane Kimberlite Pipe
(after Kresten, 1973)
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8
DEPOSIT TYPE
The Lemphane kimberlite intrusion is a kimberlite diatreme, or pipe, which was the feeder
to a now eroded kimberlite volcano. Kimberlite is by far the most important primary
source of diamond.
Diamonds are a high pressure (~50 Kbar) and temperature (~1,200°C) variety of carbon,
which form at depths of at least 150 km below the earth’s surface. Kimberlite is a
volcanic rock, which originates at great depth, between 150 km and 300 km, in the
asthenosphere. Rapidly ascending kimberlite magma entrains diamonds, together with
other rocks and minerals present at those depths.
Kimberlite is named after the diamond-mining centre of Kimberley, South Africa, where
the diamond bearing rock type was first discovered. Prior to the Kimberley discoveries,
all world diamond production had been from alluvial deposits and the primary source was
unknown.
Only a small minority of kimberlite bodies contain diamonds in sufficient concentrations to
be considered as diamond ore. The great majority of kimberlites have zero or very low
diamond contents. It has been found that those which do have elevated diamond tenors
usually occur in areas of old and stable crust, which are typically found in the cratonic
cores of continental blocks. Kimberlites within younger orogenic belts usually contain few
or no diamonds. Cratonic areas are characterised by thick crust and low geothermal
gradients.
The transportation of entrained diamonds to the surface must be rapid in order to prevent
their resorption or retrogression to graphite as pressure is released. Kimberlite magma is
very rich in volatiles, notably CO2, which makes this rapid ascent possible, and explosive
breakthrough to the surface may start at depths of 2 to 3 km, giving rise to the
characteristic carrot shaped pipe, or diatreme.
A number of challenges are inherent in diamond sampling and evaluation, and any
exploration programme should be designed to mitigate these challenges:
•
Even in economically viable deposits, diamonds are present in extremely small
quantities, and their distribution within the host tends to be erratic (e.g. a grade of
10 carats per hundred tonnes (cpht) is equivalent to 0.02 parts per million)
•
The size and value of stones is erratic and it is possible that the bulk of the value
of a parcel of diamonds is attributable to small number of individual stones or even
a single stone
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•
Drill sampling of hard kimberlite tends to break larger diamonds, and underrecover smaller diamonds due to a reduction in liberation.
It is not uncommon for there to be multiple intrusions within a single kimberlite pipe, so
that the later intrude the earlier ones. The tenor and quality of diamonds may vary
between different facies and lithologies, therefore a good geological model and
lithologically controlled sampling are important in evaluation. To eliminate the evaluation
challenges caused by these factors, very large samples are required. Grade may be
determined by relatively small samples and analysis for diamonds using caustic fusion
total liberation diamond content samples. This is because the diamond population in a
kimberlite follows a log normal size distribution. The size frequency of the commercial
sized diamond population can therefore be accurately estimated from the size frequency
of the ‘microdiamond’ population. However, the microdiamond population does not
provide adequate revenue information. In order to determine the typical revenues to be
expected for a diamond deposit, the following is required:
•
Grade (cpht)
•
Diamond size frequency distribution
•
Diamond revenue (USD/ct), measured by the valuation or sale of a complete
parcel of diamonds at current prices.
In order to measure a mineral resource with respect to diamonds, the following
parameters must be defined:
•
Tonnage, which is the calculated volume of the ore deposit multiplied by its
density (specific gravity)
•
Grade
•
Average diamond value
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9
MINERALISATION
The property includes the Lemphane kimberlite pipe and associated dykes and blows.
Diamonds may occur as rare xenocrysts which have been entrained by a kimberlite
magma during its ascent to surface from depths ranging between approximately 150
and 180 km. Factors influencing the grade of mineralization include the quantity of
diamonds originally entrained by rising magma, the rate of ascent to surface and
possible resorption of some diamond into graphite, and dilution of the primary kimberlite
magma by barren country rock material.
The presence of diamond at Lemphane has been empirically determined by Meaton
(1966), although this work was not NI 43-101 compliant. The presence of artisanal
diggings and historical artisanal production figures confirm that diamonds do occur in
the kimberlite. Sampling work undertaken by Meso, and reported in Section 10.2.1
further confirms the presence of diamonds. However, the grade of the Lemphane
kimberlite has not yet been determined by a NI 43-101 compliant sampling programme.
Kresten (1973) reported that approximately 250 artisanal diggers were active on the
pipe in the early 1970s.
Figure 9-1
Artisanal miners at Lemphane
Today, artisanal miners are digging holes up to 9 m deep through the slumped material
and primary soil profile to reach the top surface of the kimberlite. The eluvial lag deposit
present above the primary weathered kimberlite is brought to surface, screened, and
then concentrated and sorted by hand.
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Kresten (1973) describes diamonds from Lemphane as, “…. pale yellow with
subordinate colourless, grey and brown colours. About 80% are broken and formless.
The most common crystal form is dodecahedron with subordinate trisoctahedron and
octahedron; combinations as well as twinned crystals also occur.” She further reports
that stones of over 4 carats occur.
Unconfirmed reports from the diggers themselves indicate that the majority of stones
recovered are white, but MSA has not verified this claim. No diamonds were observed
during the site visit made on 9th October 2010. Mr A. Sekhele, a Lesotho Government
diamond valuer, present at Lemphane during the early 80’s suggests anecdotally that
the largest stone to be recovered at Lemphane at that time was 32 carats. He has also
commented that he has seen a 3.7 ct blue stone at Lemphane and other fancy colours
including pink, yellow and black. Again, MSA cannot verify this claim.
Figure 9-2
Top left: Pit sunk by artisanals through slumped (non-kimberlite) material and soil cover to
access the eluvial lag on the upper surface of the kimberlite. Depth approximately 6m. Bottom
left: Screening and hand concentrating of excavated material. Top right: Screened and hand
concentrated material. Bottom right: Hand sorting the concentrate.
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Determination of the presence or absence of Type II diamonds at Lemphane may be
important in determining the deposit’s economic potential. Moore (2009) has reported the
characteristics of Type II diamonds. They were originally distinguished on the basis of
their infra red (IR) spectra, with Type IIa stones characterised by their very low (<20 ppm)
nitrogen contents. The Type IIa stones often have top quality white colours (D-G), a
consequence of their low nitrogen contents. They include the largest gem diamond ever
found, the 3 106 ct Cullinan, recovered from the Premier Mine, South Africa, as well as
gems like the legendary Koh-i-noor and Hope, from India. The presence of an unusually
high proportion of Type II stones at Letseng results in this locality having the world’s
highest average diamond value (USD 1 753/ct in 2009) for a kimberlite, and being the
lowest grade (< 2ct/100t) pipe ever mined economically.
Type IIa diamonds from Letseng have the following general characteristics:
•
Morphology is typically irregular and stones are often elongated and distorted.
They are described as being highly resorbed. Very rarely, primary crystal faces
are preserved.
•
They can be almost any colour except yellow (reflecting the absence of nitrogen).
Many are of top white colour (D,E,F or G), but they also occur in shades of brown.
At Letseng, most pink and brownish-pink stones are Type IIa varieties.
•
Silicate, oxide and sulphide inclusions are either very rare or absent in Letseng
Type IIa stones, and where “flaws” are observed, these are invariably graphite.
•
Unlike Type I diamonds, which cleave in steps, the Type II stones often show
excellent planar cleavage – a characteristic linked to their low nitrogen contents.
•
With very rare exceptions, the Letseng Type IIa stones do not fluoresce.
•
The proportion of Type IIa stones at Letseng increases with diamond size,
constituting 13% of the population in the 0.05 to 0.15ct range, but 38% (in carat
terms) of the +10.8 ct stones in the Main Pipe and 69% of the stones of this size
category in the Satellite Pipe. They thus show a bias towards large stone size.
The paragenesis of Type IIa diamonds does not appear to be linked to either the
peridotitic or eclogitic suites. The presence or absence of peridotitic pyrope or eclogitic
garnets does not therefore provide a direct indication of the presence or absence of Type
II diamonds.
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10
EXPLORATION
Kresten (1973) reported that the evaluation work undertaken by Meaton in the 1960s
indicated primary grades of 1 to 2 cpht for the Lemphane kimberlite, with some local
eluvial and alluvial enrichment also reported. However, this work was not NI 43-101
compliant. The reports of Meaton have not yet been obtained, and will be reported in the
future if they can be found. The current exploration work being undertaken by Meso,
represents the first systematic exploration of the Lemphane kimberlite pipe since the work
of Meaton.
10.1 Exploration approach and methodology
The exploration approach followed by Meso is to first demonstrate the potential of the
kimberlite by collecting samples in the vicinity of the pipe and processing for indicator
minerals and diamonds, and undertaking a geophysical survey. Favourable results from
this work will lead to a phased evaluation programme. Results from some initial grab
samples are reported below.
The objective of the sampling work is to prove the presence of diamonds, and to obtain
indicator mineral chemistry, to demonstrate that the kimberlite has entrained material
from diamondiferous mantle and estimate the proportion of this material. The objective of
the geophysical survey is to measure the areal extent of the pipe and determine the
presence of separate internal geological phases, which are likely to carry different
diamond tenor. The identification of different kimberlite phases will inform future sampling
work, such that separate geological phases will be sampled separately.
10.2 Grab Sampling
To date, Meso have collected a total of 14 samples from PL005. These samples are
summarised in Table 10-1 and shown in Figure 10-1.
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Table 10-1
List of samples collected over the Lemphane Kimberlite
Sample ID
Lat (Y)
Date
Sample Type
LEM 1A&B
-28.942444
Long (X)
28.583556
12-Aug-10
Stream sediment
LEM 1
-28.942528
28.583778
06-Jul-10
Weathered kimberlite
LEM 2
-28.943278
28.583389
06-Jul-10
LEM 3
-28.943528
28.583694
06-Jul-10
LEM 4
-28.943333
28.583333
06-Jul-10
LEM 8
-28.942917
28.584528
12-Aug-10
LEM 9
-28.943278
28.585111
12-Aug-10
LEM 10
-28.943694
28.585139
12-Aug-10
LEM 11
-28.944111
28.584056
12-Aug-10
LEM 12
-28.944417
28.584194
12-Aug-10
LEM 13
-28.944389
28.584556
12-Aug-10
LEM 14
-28.944111
28.585694
12-Aug-10
LEM 15
-28.944111
28.585694
12-Aug-10
LEM A-L
-28.941028
28.582222
06-Jul-10
Stream sediment
Figure 10-1
Samples localities, superimposed on the geophysical interpretation of the pipe
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10.2.1 Grab Sampling Results
Results from all samples have been received and are reported below:
+1.18 mm
+0.850 mm
+0. 600 mm
+0.425 mm
+0.300 mm
+0.212 mm
Sample
Type
LEM 1-4
Kimberlite
60.10
1
LEM 8
Kimberlite
6.92
0
LEM 9
Kimberlite
9.61
3
LEM 10
Kimberlite
8.08
0
LEM 11
Kimberlite
12.56
0
LEM 12
Kimberlite
11.86
1
LEM 13
Kimberlite
8.68
0
LEM 14
Kimberlite
14.72
1
LEM 15
Kimberlite
4.80
0
137.33
6
4
0
1
0
0
1
0
0
230.3
13
3
2
2
2
1
1
1
1
230.3
13
3
2
2
2
1
1
1
1
LEM A-L
Stream
TOTAL
No
Stones
+0.150 mm
Sample
number
TOTAL
Mass
(kg)
+0.106 mm
Table 10-2
Total Liberation by Caustic Fusion Sampling Results
1
2
1
1
1
Too few stones were recovered for statistical size frequency analysis. However, a total of
19 stones have been recovered for IR spectral analysis. All but one of the stones is
reported as white in colour.
Table 10-3
Heavy Mineral Stream Sampling Visual Sorting Results
Sample
number
LEM 1A + 1B
Size
Fraction
Diamond
Garnet
Ilmenite
Chrome
Diopside
Chrome
Spinel
0
331+
120+
~208
120+
+0.5 mm
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Abundant garnet, ilmenite, chrome diopside and chrome spinel were recovered, all of
which are probably derived from the Lemphane kimberlite. Garnet, ilmenite and spinel
was not stripped from the samples, but a representative number of grains was recovered.
The total number of chrome diopside was estimated from stripping all of the grains from
50% of the sample concentrate. It is recommended that all of these grains are
microprobed to determine their major element geochemistry and confirm their
paragenesis.
10.3 Geophysical Surveys
In August 2010, a detailed ground magnetic survey was undertaken by The MSA Group
over the Lemphane kimberlite pipe in Lesotho, on behalf of Meso. The objectives were to
map the pipe contacts, basalt float, and potential different facies within the pipe, as well
as to locate cross-cutting dykes and structures. A line spacing of 20 m and station
spacing of 2 m were used. A total of 10.51 line km was surveyed.
The survey results showed a substantial magnetic low associated with the pipe, indicating
strong remnant magnetism. The western edge of the pipe is very sharp and linear,
suggesting that the contact is near vertical and that the pipe may be intruded along a
structural feature such as a fault. The south-eastern and eastern edges are less sharp,
implying that the pipe contacts may be dipping. The edges of the pipe can be effectively
mapped using the derivatives of the total field. The areal extent of the pipe is interpreted
as 6.4ha.
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Figure 10-2
Ground magnetic survey results. Total magnetic field with survey lines (top) and
interpretation overlain on an image of the 1st vertical derivative (bottom)
654600
6797500
654500
6797500
6797400
654400
6797400
6797300
654300
6797300
6797200
654200
6797200
,
29023
28807
28660
28531
28442
28364
28295
28230
28171
28115
28062
28001
27952
27905
27858
27813
27769
27725
27680
27627
27583
27539
27494
27449
27403
27356
27307
27246
27193
27137
27077
27013
26944
26865
26777
26648
26501
26285
Total Field
(nT)
Scale 1:2500
25
0
25
50
75
100
125
150
(meters)
6797100
6797100
Lemphane Kimberlite Pipe
Detailed Ground Magnetics
20m Line Spacing
2m Station Spacing
654400
654500
654600
654200
654300
654400
654500
654600
GRS Consulting for the MSA Group
6797500
6797400
6797200
6797200
6797300
6797300
6797500
654300
6797400
654200
,
84.83
52.53
38.42
30.05
23.97
19.88
16.31
13.29
10.86
8.57
6.70
5.06
3.60
2.17
0.90
-0.35
-1.51
-2.74
-3.97
-5.15
-6.38
-7.58
-8.77
-10.03
-11.27
-12.63
-13.90
-15.45
-17.09
-18.79
-20.77
-23.03
-26.02
-29.48
-34.00
-41.02
-52.13
-75.32
Interpretation
Main Pipe
Mag positive dyke
Mag negative dyke/pipe
Basalt blocks
First Vertical Derivative
Scale 1:2500
25
0
25
50
75
100
125
150
679710 0
6797100
(meters)
Lemphane Kimberlite Pipe
Detailed Ground Magnetics
20m Line Spacing
2m Station Spacing
654200
654300
654400
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654500
654600
GRS Consulting for the MSA Group
35
Figure 10-3 shows a comparison between the map of Kresten (1973) and the geophysical
interpretation. There is a strong correlation. Similarities include the approximate size and
shape of the pipe, the small blow on a dyke identified on the western edge of the pipe,
and some internal geological features However there are some differences. The
geophysical survey has identified some additional dykes and possible blows with a very
similar geophysical signature to that mapped by Kresten, as well as some additional
internal geology. The north-east trending shear zone mapped by Kresten does not appear
to have a magnetic signature.
Interpretations of the internal geology identify magnetically quiet and magnetically busier
portion in the core part of the pipe, and a magnetic low partially surrounding the core.
These may represent distinct intrusive phases. A number of new NW-SE and E-W
trending linear features have been mapped which are interpreted as dykes (possibly
kimberlite or dolerite). In addition to the inferred dykes, a number of small sub-circular
features were identified which may correspond to blows or small satellite pipes. Discrete
magnetic anomalies within the pipe indicate probable basalt blocks, which may have been
incorporated into the main pipe. In summary, five possible kimberlite phases are
interpreted and are listed below in the possible order of emplacement which is inferred
from their geometry:
•
Kimberlite dykes;
•
Kimberlite blows;
•
A ‘collar’ phase;
•
A northern core phase containing a relatively low proportion of country rock
xenoliths.
•
A southern core phase containing a greater proportion of country rock xenoliths;
If the interpretation of the pipe contacts as very steep are correct, then the upper 200 m
of the Lemphane pipe could contain over 30 Mt of kimberlite.
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Figure 10-3
Comparison of the geophysical interpretation with the geological map of Kresten (1973)
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11
DRILLING
No drilling has been undertaken on the kimberlite.
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12
SAMPLING METHOD AND APPROACH
Meso has adopted a phased approach to sampling to mitigate risk. Continuation from
one phase of work to the next implies that the results from the previous phase were
encouraging. The sampling methodology is summarised in Table 12-1.
Table 12-1
Sampling methodology
Phase
Initial Phase
Initial Phase
Evaluation
Phase I
Method
Total Liberation by
Caustic Fusion
Sampling
(“Microdiamonds”)
Kimberlitic Indicator
Minerals
Objectives
•
•
•
•
Pitting and mapping
•
Evaluation
Phase I
Total Liberation by
Caustic Fusion
Sampling
Evaluation
Phase I
Kimberlitic Indicator
Minerals
•
•
•
•
Evaluation
Phase I
Evaluation
Phase II
Evaluation
Phase II
Evaluation
Phase II
Bulk sampling
•
Bulk sampling
•
Core drilling
•
Core drilling
Total Liberation by
Caustic Fusion
Sampling
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•
•
Demonstrate presence of diamonds
Obtain diamonds for analysis to
determine presence of Type IIa
diamonds
Investigate and quantify degree of
mantle ‘sampling’ by the kimberlite
Investigate geological kimberlite
phases to control ongoing sampling
work
Total diamond content and size
frequency estimation of individual
kimberlite phases
diamonds
‘Fingerprint’ individual kimberlite
phases from pit samples
Investigate mantle ‘sampling’ by each
phase
diamonds
Determine grease recovery of
diamonds
Obtain large parcel of diamonds for
grade and revenue determination
Sub-surface density and geometry for
geological model
3D total content grade and size
frequency model
Determine mineral resource
39
13
SAMPLE PREPARATION, ANALYSES AND SECURITY
To date, only kimberlitic indicator mineral and total diamond content caustic fusion
sampling has been undertaken at Lemphane.
13.1 Kimberlitic Indicator Mineral Sample Analysis
The kimberlitic indicator mineral sample was exported from Lesotho with a valid permit
and received at MSA in Johannesburg. The sample was wet-screened into three size
fractions: +2.0mm; -2.0, +0.3mm and -0.3mm. The oversize (+2.0mm) and undersize (0.3mm) material was discarded. The -2.0mm, +0.3mm material was concentrated using
tetrabromoethane (TBE) which has a density of 2.96 g/cm3. The TBE concentrate was
cleaned using oxalic acid to remove oxide coatings on mineral grains and produce a
clean mineral concentrate for visual microscopic examination.
The concentrate was screened into three size fractions for visual examination: -2.0,
+1.0mm; -1.0, +0.5mm; and -0.5, +0.3mm.
Each fraction was visually sorted for kimberlitic indicator minerals and diamonds. Indicator
minerals were placed on cards for later microprobe analysis.
None of the indicator minerals have been microprobed as of the effective date of this
report.
13.2 Caustic Fusion Total Liberation Diamond Content Sample Analysis
Caustic fusion total liberation diamond content (“microdiamond”) samples were exported
from Lesotho with a valid permit and received at MSA in Johannesburg. The caustic
fusion laboratory is a secure environment with restricted access.
The samples were subjected to caustic fusion at the MSA/SGS laboratory in
Johannesburg. Caustic fusion provides a concentrate from which liberated diamonds can
be readily extracted by microscopic examination. Sample weight reductions after caustic
fusion are typically greater than 99.8%. The standard operating procedure is briefly
described below.
•
For each sample the optimum aliquot was determined by loading a variety of
weights to individual pots and assessing the maximum weight that can be
successfully dissolved per pour.
•
The carbonate content was assessed by testing with hydrochloric acid prior to
aliquot preparation and caustic fusion.
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•
Other than simple breakage of the kimberlite into +/- 20 mm sized pieces, no other
sample preparation was performed prior to dissolution by caustic fusion.
•
Caustic soda was added to the kimberlite sample in each pot and the kiln was
heated to 550 ºC. This temperature was maintained for fourteen hours.
•
After the digestion in molten caustic soda, the sample residue was screened using
a bottom screen of 75 microns (µm).
•
The residue, greater than 75 µm, was liberated from the NaOH by washing in
hydrochloric acid leach and hot water baths. The bottom screen for the acid leach
was 75 µm. The washed residue of each sample, enclosed in the 75 µm screen
used during the leaching and washing process, was then dried.
•
The dry residue of each sample, wrapped in the 75 µm screen used during the
acid leach, was received for sorting.
•
If the residue was large (> 30 g) a secondary fusion, in smaller crucibles, was
done. This involved treating the acid cleaned caustic residue in a mixed chemical
0
flux at 550 C to remove ilmenite and garnet. This produced a significantly smaller
sample residue more suitable for diamond recovery.
•
Quality control throughout the process was monitored by spiking with sized
synthetic diamonds that are easily identifiable. The synthetic diamond spikes were
added to the sample at the start of the caustic fusion process.
•
The synthetic diamonds used to monitor the process efficiency for each sample
were selected from the following 3 size fractions: -425 µm to +300 µm, -300 µm to
+212 µm and -212 µm to +150 µm.
•
Natural and synthetic diamonds were recovered from the +75 µm residue using 60
x magnification with a binocular microscope. The residue was examined a
minimum of two times to ensure the total recovery of diamond.
•
Recovery rate of the spikes was reported (see Section 14.2) and the recovered
spikes were stored on sample cards.
•
The recovered diamonds were separated into 13 sieve classes by screening.
•
Recovery rate of the spikes was reported and the recovered spikes were stored
on sample cards.
•
Colour, clarity, and morphology of each diamond was determined and reported.
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41
•
X, Y and Z dimensions of each diamond were measured in mm.
•
All diamonds greater than 300 µm were weighed individually and placed on
sample cards. Diamonds smaller than 300 µm were weighed in groups.
•
The gram weight was converted to carats.
•
Diamond data was tabulated in Excel spreadsheets.
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14
DATA VERIFICATION
Historical data and information on adjacent properties recorded in this report has been
obtained from published reports as referenced, and has not been independently verified.
Samples from the current exploration programme have been subject to quality control
measures as described below.
14.1 Kimberlitic Indicator Mineral Samples
Quality control for the recovery of kimberlitic indicator mineral was established by
adherence to standard operating procedures and 100% check sorting. The MSA
laboratory operates a quality management system and has applied for ISO 17025
accreditation.
14.2 Caustic Fusion Total Liberation Diamond Content Samples
Quality control for the recovery of diamonds using the caustic fusion total liberation
process was established by adherence to standard operating procedures and spiking of
samples with diamonds in different size fractions. 25 diamonds were introduced to each
sample prior to dissolution with caustic soda. 100% of all spikes were recovered during
the sorting process, indicating that the process is very efficient. The MSA/SGS caustic
fusion laboratory operates a quality control system and has applied for ISO 17025
accreditation.
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15
ADJACENT PROPERTIES
The Lemphane Project lies within the northern Lesotho kimberlite cluster. This area of
kimberlite occurrences was first recognised in the late 1950s and includes over 100
known kimberlite intrusions, varying in size from the Kao pipe (19.8 ha) and the main
Letseng pipe (15.9 ha) to several small dykes and blows.
Historically, only the Letseng and Liqhobong pipes have been mined. The Letseng pipes
were originally mined by De Beers, and more recently by Letseng Diamonds (Pty) Ltd.
Two other pipes in the cluster have been subject to investigation and project development
in recent years, namely Mothae and Kao.
Figure 15-1
Northern Lesotho Kimberlite cluster
A characteristic of kimberlites in the adjacent properties is the occurrence of large, high
quality stones which have very high value. The occurrence of such stones at Lemphane is
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anecdotal and has not been confirmed. Testing for such stones will be an important
objective in the sampling programmes.
The adjacent properties are summarized below.
15.1 Letseng Diamonds
Table 15-1
Letseng Mine (source Gem Diamonds Annual Report 2009)
Owner:
Gem Diamonds (70%), GoL (30%)
Mining Licence:
Letseng ML
Area of Licence:
68 km
Production periods;
1977-1982, 2004 - present
Mining method:
Open pit
Grade:
1.2 ct/100t (2009)
Production
90 878 carats (2009)
Approx. value
USD 1 534/ct (2009); USD 28 per tonne
Geology
Letseng kimberlite Main Pipe (15.9 ha) and Satellite Pipe (4.7
ha). Some minor eluvial and alluvial deposits also included in the
Mining Licence have been mined out.
Life of Mine
2029 and beyond.
Resource /
Reserve
Probable reserve of 68.7 Mt grading at 1.59 ct/100t with an
average value of USD 1 753 per ct.
2
Total resource* of 239 Mt grading at 1.74 ct/100t with an
average value of USD 1 592 per ct.
*Includes reserves
The Letseng Mine was acquired by Gem Diamonds from JCI Ltd in 2006 for USD 118.5
million. The mine is characterised by very low grade ore but is well known for producing
large diamonds. It produces the highest percentage of ‘special’ diamonds (gems greater
than 10.8 carats) of any kimberlite diamond mine.
Letseng is renowned for its production of historic diamonds, many of which have been
identified as Type IIa stones. The recently recovered 478 carat Leseli la Letšeng white
diamond (sold for USD 18.4 million) is the world’s 20th largest rough gem diamond and
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third significant recovery from the Letseng Mine in as many years, following the 603 carat
Lesotho Promise (14th largest; sold for USD 12.4 million) and the 493 carat Letšeng
Legacy (18th largest; sold for 10.4 million) recovered in 2006 and 2007 respectively.
Including the 601 carat Lesotho Brown, recovered in 1960 (15th largest), the Letseng
Mine has now produced four of the world’s 20 largest rough gem diamonds and the three
largest gem diamonds recovered this century. In September 2010, the mine reported a
196 ct white stone which has yet to be sold.
Figure 15-2
Panoramic View of Letseng Mine
(photo by Tessa Joughin on panoramio.com)
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15.2 Mothae Diamond Project
Table 15-2
Mothae Project
Owner
Lucara Diamond Corporation (75%), GKL (25%). GKL has a
12.5% free carry and will fund the balance from its share of
profits.
Mining Licence
Valid until September 2019.
Area of Licence
20 km2
Mining start date
Test mining underway since mid-2010. Plan to commence new
mine production in 2013.
Mining method
open pit
Grade
4.7 ct/100t (dry sample grade from a total of 82 380 t of bulk
samples)
Production
Trial mining 30 000t per month. Full production (2014) estimated
2.5 Mt and 70 000 ct per annum.
Approx. value
USD 549 per ct (modelled); USD 25.8 per dry tonne (modelled)
Geology
An elongate pipe (8.8 ha) comprising multiple kimberlite types
intruding Karoo basalts.
Life of Mine
12 years
Royalty
8% of gross revenue
Resource
Reserve
/ Not yet reported.
Lucara Diamond Corp has acquired a 75% share in the Mothae Project through funding
of exploration (USD 10 million) and purchase of outstanding shares in Motapa Diamonds
Inc in 2009. Sampling work in 2009 recovered a 23.4 ct Type IIa diamond. In June 2010,
the company commenced a 720 000 t trial mining programme and reported the recovery
of a 53.5 ct Type IIa diamond within the first 2 000 t of material processed. The first sale
of diamonds from the trial mining is scheduled for the first quarter of 2011.
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Figure 15-3
Geological Model of the Mothae Kimberlite. The pipe is approximately 700m long
(source: Lucara Diamond Corp website)
15.3 Kao Project
The Kao kimberlite pipe was discovered in the 1950s and artisanal production of 17,567
carats was recorded when the pipe was declared a government digging during the 1960s.
Stones produced included a 46 carat “blue white”, a 387 carat “pure white” and a 33 carat
“blue”. The pipe was explored and assessed by the Newmont joint venture company
known as Maluti Diamond Corporation, in the early 1970s. The Newmont assessment
included both drilling (some 2 600 m) as well as bulk sampling of 11 large pits (6 x 20 m
deep). Individual bulk samples of 1500 t each were crushed to pass through a 12 mm
screen and a concentrate was obtained using a DMS plant. Diamonds were thereafter
recovered with an X–ray fluorescence “Gunner Sortex” machine.
The Newmont sampling results were deemed sufficiently reliable and thorough for the
upper 60 metres of the Kao Pipe to be classified as an indicated resource of 27 million
tons at 7 cpht (SRK reported by Venmyn, 2010).
Subsequent drilling and total liberation diamond work led to a revision of the resource.
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Table 15-3
Kao Project
(Source: Venmyn Rand (Pty) Ltd Independent Competent Person’s Report dated 28th
February 2010)
Owner
Namakwa (75%), GKL (25%)
Mining Licence
Kao ML valid until 2019 and renewable for three periods of 10
years each subject to production targets.
Area of Licence
6.53 km2
Mining started
Trial mining started in May 2010
Mining method
Open pit.
Grade
Not yet reported
Production
Not yet reported
Approx. value
Not yet reported. USD 10.9 per tonne based on the reported
resource model.
Geology
Two kimberlite pipes (Main Pipe, 19.8 ha and Satellite pipe 3.2
ha)
Life of Mine
Not yet reported
Royalty
8% of gross revenue
Resource
Reserve
/ Indicated resource of 20.9 Mt at 7.06 cpht and USD 154/ct
Venmyn have valued the Kao Project at approximately USD 22.4 million (Venmyn, 2010;
Net Present Value calculated from a discounted cash flow at 10% discounted rate). The
project is currently undergoing trial mining. A parcel of diamonds recovered from the trial
mining and totalling in excess of 6 000 ct was scheduled to be sold by tender in October
2010. The results of the tender were not published prior to the effective date of this
report.
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Figure 15-4
Geological Model of the Kao kimberlite main pipe. The pipe is approximately 750m across (NE-SE)
(source: Venmyn Rand, 2010)
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15.4 Liqhobong Project
Table 15-4
Liqhobong Project (± 6 km E of Lemphane)
(source Firestone Diamonds AIM admission document, 2010)
Owner
Firestone Diamonds plc (75%), GKL (25%)
Mining Licence
Liqhobong Mining Lease valid to 2017 and renewable for a
further period of 10 years
Area of Licence
3.9 km2
Production period
2005 - 2008
Mining method
Open pit
Grade
43.5 cpht
Production
352,780 ct
Approx. value
USD 48/ct
Geology
Two kimberlite pipes
Life of Mine
Not yet determined
Royalty
10%
Resource /
Reserve
Indicated resource (Main pipe) of 38.54 Mt with an average grade
of 32.8 cpht and an average revenue of USD 86/ct. An inferred
resource of 52.12 Mt with an average grade of 35.5 cpht and the
same revenue (+1.0mm). No reserve has been defined.
On 29th September 2010, Firestone Diamonds plc acquired Kopane Diamond
Development plc in an all-share deal valued at USD 70.7 million. The Liqhobong Project
is an exploration property (as that term is defined in NI 43-101) and was the only
significant asset in the Kopane portfolio. A definitive feasibility study is underway and is
scheduled to be completed at the end of 2010. It is reported that the largest Type IIa
diamond recovered at Liqhobong was a 144 ct D-colour white stone which was broken in
the recovery process in 2006.
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16
MINERAL PROCESSING AND METALLURGICAL TESTING
No metallurgical testing has been conducted on samples from the Lemphane Project.
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17
MINERAL RESOURCE AND MINERAL RESERVE
ESTIMATES
No NI 43-101 compliant mineral resource has been defined on the Lemphane Project.
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18
OTHER RELEVANT INFORMATION
18.1 Diamond Market
All diamond projects are sensitive to diamond revenue and diamond price fluctuations.
Forward looking diamond demand and supply models in recent years have all indicated a
steady rise in demand (driven largely by growth in the number of Chinese and Indian
consumers) with a steady decrease in supply as major diamond resources are depleted,
and few new mines come into production (see for example Figure 18-1).
Figure 18-1
Rough diamond supply vs demand forecast pre-global financial crisis
(source: WWW International Diamond Consultants Ltd)
This scenario was driving diamond prices higher until the third quarter of 2008, when the
global financial crisis (GFC) caused a rapid decline in diamond prices. As signs of global
economic recovery appear, both rough and polished diamond prices have resumed their
upward trend. Several sources suggest evidence of a strong recovery in rough diamond
prices having occurred through 2010:
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•
De Beers reported strong demand following Quarter 3 auction sales from Diamdel
(source: Diamdel auctions update, October 20, 2010).
•
In September 2010, Rio Tinto announced a USD 803 million investment in
underground development at the Argyle diamond mine in Australia. Spokesmen
indicated, “This investment …. underlines our commitment to and confidence in
the world diamond industry. The project was slowed in 2009 due to the global
financial crisis but the diamond market continues to recover and long-term
industry fundamentals remain healthy. A significant supply gap is expected to
emerge in the medium to long term and the outlook for demand is strong, driven
by the growth of emerging markets." (source: Rio Tinto Diamonds news release,
September 14, 2010).
•
According to IDEX online, Indian imports of rough diamonds in May 2010 were
comparable to pre-crash levels. The same was reported for Belgium. (source:
IDEX online news report dated June 16, 2010).
•
Petra Diamonds reported strong recovery in rough diamond prices in their results
for the year ended June 30, 2010.
•
Quarter 2 2010 diamond sales reported by Harry Winston Diamond Corporation
st
(press release dated 1 Sept 2010) indicate an average 62% increase in rough
diamond prices relative to the same period in 2009.
Figure 18-2 shows the growth of rough and polished diamond prices since 2002. The
effect of the global financial crisis on diamond prices was profound. There has been a
subsequent recovery in both the price of rough and polished diamonds. However, it is
remarkable to note that according to WWW Interational Diamond Consultants, the price
of rough has already surpassed the pre-GFC peak.
This recovery is expected to continue. In a presentation given to the colloquium entitled
“Diamonds - Source To Use” held in Gaborone from 1 – 3 March 2010, Allan - Hochreiter
(an independent corporate finance company) forecast real growth in diamond prices of
7% per annum from March 2010 until 2020. Royal Bank of Canada Europe Limited, an
investment bank, published an equity research report on the diamond industry on 3rd
March 2010. This report forecast a short term price increase of 7% between March 2010
and January 2011. From this short review of a number of separate and independent
sources, it appears that the diamond market, and in particular the rough diamond market,
has already recovered from the GFC, this recovery is robust, and prices will continue to
rise.
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Figure 18-2
Rough and polished diamond prices 2002 to September 2010
(sources: WWW International Diamond Conultants and PolishedPrices.com)
In the medium- to long-term, demand for rough diamonds is expected to continue to
outstrip supply as mineral reserves continue to dwindle and the market continues to
expand. Recent capital investments at major mines around the world (e.g. Jwaneng in
Botswana and Argyle in Australia) will not boost production. They will only extend the life
of those mines. The consequence of this is likely to be that prices of rough diamonds will
continue to rise, and marginal diamond projects will become economic. If this is the case,
it is unlikely that the additional supply from new producers would be sufficient to change
the overall trend. Demand will continue to outstrip supply in a growing market. However,
as a luxury item, diamonds remain very vulnerable to global economic downturns, and the
positive outlook for diamonds remains heavily dependent on continued short term
economic recovery, and longer term economic stability.
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19
INTERPRETATION AND CONCLUSIONS
Meso is embarking on an aggressive evaluation of the Lemphane kimberlite based on a
review of available information on the kimberlite itself and adjacent properties. The initial
geophysical and sampling programme has slightly increased the interpreted areal extent
of the main pipe, and confirmed the presence of diamonds. The results of this initial work
have prompted a decision to move ahead with a phased bulk sampling programme.
In historical context, Lemphane was one of the kimberlite discoveries identified as a
‘Government digging’ during the 1960s, along with adjacent kimberlites such as Letseng,
Kao and Liqhobong. As such, it must be regarded as a target with some potential.
However, it has subsequently received less attention than these other properties and this
may be due to a variety of reasons. For example, it was relatively more remote compared
to the other kimberlites, the overburden had a greater thickness or it may be due to lower
grade or value of stones. This can only be established by a proper evaluation programme.
The recent upgrade of access to nearby Liqhobong means that the previous remoteness
of Lemphane is no longer an issue.
The ground magnetic survey on the kimberlite identified some inferred internal geological
contacts. The presence of different kimberlite phases have been confirmed from outcrop,
and this may be significant in terms of variations in grade and revenue. The pipe is
approximately 6.4 ha near surface with steep wall contacts. Two alternative
interpretations of internal geology have been made, but essentially five possible kimberlite
phases are recognised and are listed below in their possible order of emplacement, which
is inferred from their geometry:
•
Kimberlite dykes;
•
Kimberlite blows;
•
A ‘collar’ phase;
•
A northern core phase containing a relatively low proportion of country rock
xenoliths;
•
A southern core phase containing a greater proportion of country rock xenoliths.
These inferred phases will be investigated during the planned sampling programmes (see
Section 20).
No measurement of the volume or tonnage of kimberlite has been undertaken. However,
based on the geophysical survey, and the inference that the pipe contacts are steep, the
upper 200m of the pipe could conceptually contain approximately 30 Mt of kimberlite.
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No recent grade or revenue determination has been undertaken. These will be the
subject of the Phase I and Phase II evaluation programmes described in Section 20.
19.1 Project Risks and Opportunities
Meso are aware of project risks as listed in Table 19-1.
Table 19-1
Summary of Project Risks
Risk Category
Description of Risk
Rating
Environmental
Artisanal workings
Moderate
Environmental
Drainage into the
Khatse Dam
Moderate
Financial
Exchange rates
Moderate
Technical
Grade and revenue
High
Technical
Evaluation
sampling
methodology
Low
Technical
Mining method
Moderate
Technical
Evaluation and
mining footprint
Moderate
Community
Local farmers and
artisanal miners
present on site
Moderate
Mitigation/Comment
The historical and recent activity on the
property has been recorded and reported
in a preliminary Environmental study.
Drainage from the mine is into the
Malibomatsu River and slimes from
evaluation and possible future mining need
to be carefully managed.
Project development and any future
production costs will essentially be in
M/ZAR, whilst project funding is in GBP
and diamond sales would be in USD. The
ZAR/USD and ZAR/GBP exchange rates
are fairly volatile.
The grade and revenue of the project have
not yet been established and the potential
of the project remains conceptual.
There is a risk that the Phase I sampling
methodology will be ineffective due to nonrecovery of diamonds with grease. This
has been mitigated by planned extended
residence in a scrubber, and X-ray analysis
of grease tailings.
The topography would make conventional
open pit mining challenging.
The topography would make any future
mine layout challenging.
Good relations have been created and
maintained with the local residents.
Employment will be offered during the
evaluation and possible future mining of
the kimberlite.
Opportunities for the project include the proximity of the Liqhobong and Kao projects
which are in the exploration or development stage and which share infrastructural
requirements. This may provide the opportunity for certain synergies including grid power
and other infrastructure, security, skills development, resource sharing, and development
of secondary support services.
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20
RECOMMENDATIONS
The limited sampling that has been done to date has demonstrated the presence of
diamonds. The occurrence of high value stones in adjacent projects suggests that there
is the potential to find similar high value stones at Lemphane. The exploration model is
therefore to test a low grade, high revenue deposit. In order to evaluate the Lemphane
kimberlite effectively, a phased approach is proposed. Phase I is aimed at establishing
the geology of the pipe and providing some information on total content grade and size
frequency of the diamond population, as well as providing some information on the types
of diamonds present, and their recoverability. Phase II would establish the grade and
develop diamond revenue information and a three dimensional geological, density and
grade model to determine a mineral resource.
The time frame for the evaluation programme is indicated on a Gantt chart (Figure 20-1).
Figure 20-1
Evaluation Programme
Weeks
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
Phase I Evaluation
Access
Pitting
Mapping
Total content sampling and results
HM Sampling and results
Plant I establishment and commissioning
Process Pit samples (100 t)
Process Eluvial sample (100 t)
Process Alluvial sample (100 t)
X-ray analysis of grease tailings
Phase II Evaluation
Bulk sample of >1,000 t
Core drilling (~5,000 m)
(Plant design depends on results from Phase I)
20.1 Phase I Evaluation Programme
The results from the Phase I evaluation programme will assist in developing a geological
map of the kimberlite sub-crop. The results should also provide a number of diamonds
and information regarding their recoverability using grease. The Phase I work programme
will comprise the following.
•
Access - Repair the track from the village to the pipe to allow access for pitting
equipment.
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27
28
•
Excavation of pits on a 50m grid over the pipe (25 - 30 pits)
•
Mapping of kimberlite (visual and petrographic analysis) to identify different
kimberlite phases within the main pipe.
•
Total liberation diamond and heavy mineral sampling of pits to establish
kimberlite phases and establish total content grade. Samples can be combined
per kimberlite phase once this is established.
•
Establishment of a plant on site to recover diamonds.
•
Up to 5 tonnes of kimberlite material from each pit will be processed through
the plant to recover diamonds (approximately 100 to 150 tonnes).
•
Up to 100 tonnes of the eluvial lag material will be collected and processed
through the plant.
•
Up to 100 tonnes of alluvial material will be collected and processed through
the plant.
20.1.1 Phase I Evaluation Sampling Plant
A low-cost sampling plant (+1.8, -40 mm) has been designed for the Phase I evaluation
programme. The plant essentially comprises a scrubber, atritioner and grease table
arrangement. The flow-sheet is shown in Figure 20-2.
Samples will be stored in a secure environment whilst awaiting treatment. The fresh feed
will be loaded onto a feed bin with a front end loader. The feed bin will be fitted with a
static grizzly. The oversize will be deposited onto a stockpile and will be introduced into a
cement mixer loaded with abrasive balls. The residence time in the cement mixer will be
decided on site. The cement mixer feed will be re- introduced into the feedbin.
The feed from the feed bin will be conveyed to a primary scrubber and the feed rate will
be measured with a weightometer. The material from the scrubber will be fed through a
trommel fitted to the scrubber with 40 mm apertures. The material passing the apertures
will be deposited onto the scrubber screen.
The material not passing the trommel apertures will be deposited onto an oversize
stockpile and will be processed through the cement mixer with abrasive balls as described
above.
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Figure 20-2
Phase I Sampling plant and mass balance
Grizzly
10 tph
Feed Bin
Feed belt
9 tph
9 tph
Tailings belt
Greasetables
5 tph
Oversize
1 tph
Primary scrubber
9 tph
Secondary scrubber
5 tph
5 tph
Scrubber screen
9 tph
Slimes pump
4 tph
Greasefeed belt
5 tph
Storage
5 tph
The scrubber screen will be fitted with 1.8mm slotted panels. The material passing
through the screen apertures will be pumped to the slimes dam. It is estimated that
approximately 40% of material will be undersize.
The material not passing the screen apertures will be conveyed to the secondary
scrubber. The material from the secondary scrubber will be dewatered and fed onto a
classifying screen. The classifying screen will size the material into three size fractions,
one size fraction per grease table.
The material that sticks to the grease will be removed manually and put into a degreasing
canister. The canister will be put into a hot water tank where the grease is removed and
the degreased material will be dried.
The canister with the dry material is closed and sealed and stored inside a secure area
inside the grease recovery area.
The grease concentrate will be hand sorted.
It is intended that the grease table tailings will be combined and sent through an x-ray or
optical sorter to determine the proportion of diamonds which were not grease
recoverable.
It is further intended that the diamonds recovered will be analysed by the Diamond High
Council (HRD) in Antwerp to determine the presence of Type II diamonds, and to
determine their X-ray recoverability.
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20.2 Phase II Evaluation Programme
The objective of the Phase II programme will be to establish a mineral resource. This will
be achieved by sampling the geological phases identified from Phase I, and processing
them through a plant designed according to the parameters established during Phase I, in
terms of diamond recoverability. It is likely that 3 000 to 5 000 t of kimberlite will need to
be processed to establish the grade, size frequency and value of the diamond population
present at Lemphane.
In addition, a core drilling programme will be required to determine three dimensional
geological, grade and density models for estimation of a mineral resource.
20.3 Work Programme Budgets
Table 20-1
Exploration Budget (Phases I and II)
Phase
Item
Budget (GBP)
Initial Phase
Infrastructure: camp
construction and road upgrade
180 000
Initial Phase
Total liberation diamond content
analysis and kimberlitic indicator
mineral sampling
30 000
Evaluation Phase I
Pitting, mapping, total liberation
diamond content sampling,
plant, sample processing
200 000
Evaluation Phase II
Bulk Sampling (3 000 to 5 000 t)
200 000
Evaluation Phase II
Core drilling (3 000 to 5 000 m),
logging and geological
modelling
550 000
Evaluation Phase II
Total liberation diamond content
sampling of drill core
110 000
TOTAL
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21
REFERENCES
Bailey, D.K., (1992) Episodic alkaline igneous activity across Africa: implications for
the causes of continental break-up. In: Storey, B.C., Alabaster, T. and Pankhurst, R.J.
(Eds.), Magmatism and the causes of continental break-up, Geol. Soc. Spec. Publ., 68,
91-98.
Brown, R. W., M. A. Summerfield, and A. J. W. Gleadow, (2002) Denudational
history along a transect across the eastern margin (Drakensberg Escarpment) of
southern Africa derived from apatite fission-track thermochronology, J. Geophys. Res.,
107, 10.1029/2001JB000745
Catuneanu, O., Wopfner, H., Eriksson, P.G., Cairncross, B., Rubidge, B.S., Smith,
R.M.H., and Hancox, P.J. The Karoo basins of south-central Africa Journal of African
Earth Sciences, Volume 43, Issues 1-3, October 2005, Pages 211-253
De Wit, M.J., Roering, C., Hart, R. J., Armstrong, R. A., De Ronde, C. E. J., Green,
R .W. E., Tredoux, M., Peberdy, E and Hart, R. A. (1992). Formation of an Archean
continent. Nature 357, 553-562.
Eglington, B., Reddy, S. and Evans, D. (2008) IGCP 509 Example Space-Time Plot:
Palaeoproterozoic of Southern Africa. Geological Society, London, Special
Publications; 2009; v. 323; p. 27-47
Firestone Diamonds (2010) Proposed Acquisition of Kopane Diamond Developments
plc and Application for Admission of Enlarged Issued Share Capital to trading on
th
AIM.13 August 2010.
Gem Diamonds Annual Report (2009)
James, D.E., Fouch, M.J., Van Decar, J.C., van der Lee, S., and the Kaapvaal
Seismic Group (2001) Tectospheric structure beneath southern Africa. Geophysical
Research Letters, Vol. 28, No. 13, Pages 2485-2488, Jul 1, 2001
Kresten, P. (1973) The Geology of the Lemphane Pipes and Neighbouring Intrusions.
In: Lesotho Kimberlites. Edited by P.H. Nixon. Lesotho National Development
Corporation
Marsh, J.S., Hooper, P.R., Rehacek, J., Duncan, R.A., and Duncan, A.R. (1997)
Stratigraphy and age of Karoo basalts of Lesotho and implications for correlations
within the Karoo Igneous Province. Geophysical Monograph, vol 100, pp 247-272
Meaton, E. St. P. (1966) Basutoland Diamonds: Evaluation of selected kimberlites and
alluvials. London, Report of the Ministry of Overseas Development, 1966
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Moore, A.E. (2009) Type II diamonds: Flamboyant Megacrysts? South African Journal
of Geology. Vol. 112, pp 23-38.
The MSA Group (2007) Independent Technical Report on the Mothae Diamond
Project for Motapa Diamonds Inc. 12th February 2007.
Mucina, L. and Rutherford, M.C. (eds) (2006) The vegetation of South Africa,
Lesotho and Swaziland. Strelizia 19. South African National Biodiversity Institute,
Pretoria.
Nixon, P.H. (1973). Lesotho Kimberlites. Lesotho National Development Corporation
351pp.
Stockley, G.M, (1947) Report on the geology of Basutoland. Maseru. Basutoland
Government, 1947.
Thabex Ltd Annual Report (2009)
Venmyn Rand (2010) Independent Competent Persons' Report on the Mineral Assets
of Namakwa Diamonds Limited, 28th February 2010.
www.firestonediamonds.com
www.gemdiamonds.com
www.letsengdiamonds.co.ls
www.lucaradiamond.com
Lemphane Project
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22
DATE AND SIGNATURE PAGE
The undersigned, Dr Frieder Reichardt, contributed to all sections of this technical
report, titled “NI 43-101 Technical Report on the Lemphane Kimberlite Project,
th
Lesotho.” with an effective date of 28 October 2010, in support of the public
disclosure of technical aspects of the Lemphane Property. The format and content of
this report are intended to conform to Form 43-101F1 of National Instrument 43-101 of
the Canadian Securities Administrators.
Signed,
……………………………………….
Dr Frieder Reichhardt
28th October 2010
------------------------------------------------------------------------------------------------------------------
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23
CERTIFICATES
CERTIFICATE OF QUALIFIED PERSON
I, Frieder Reichhardt, Pr.Sci.Nat., do hereby certify that:
1. I am a Principal Consulting Geologist with The MSA Group, 22b Rothesay Avenue, Craighall
Park, Johannesburg.
2. I graduated with a M.Sc. degree in geology from the University of Munich in 1984. I obtained a
Ph.D. degree in geology from Pretoria University, South Africa, in 1989.
3. I am a registered Professional Natural Scientist (Geology, Registration Number 400048/04) with
the South African Council for Natural Scientific Professions and a member of the Geological
Societies of South Africa and Germany.
4. I have worked as a geologist for 26 years since my graduation. My relevant experience for the
purposes of this Technical Report is:
a. Five years (1989-1994) as senior geologist in Botswana, for Gold Fields Botswana,
engaged in exploration for PGE-Ni-Cu, kimberlite and diamonds.
b. Six years (1994-2000) as project geologist for Rio Tinto Zimbabwe, exploring for
kimberlite and diamonds in Zimbabwe resulting in the discovery of the Sese and Murowa
diamondiferous kimberlites.
c. Four years (2000-2004) as project geologist for Rio Tinto M&E Botswana, exploring for
kimberlite and diamonds in Botswana
d. One year (2005 – 2006) as Vice President of exploration for Sierra Leone Diamond
Company managing diamond exploration programmes in Sierra Leone.
e. Five years (2006 – Current) as consulting geologist for the MSA Group consulting and/or
reporting on diamond properties in Botswana, Namibia, Zimbabwe, South Africa, Brazil
and Angola.
5. I have read the definition of “qualified person” set out in National Instrument 43-101 (“NI43-101”)
and certify that by reason of my education, affiliation with a professional association (as defined in
NI43-101) and past relevant work experience, I fulfill the requirements to be a “qualified person”
for the purposes of NI 43-101.
6. I am responsible for sections 1 – 21 inclusive of this Technical Report entitled “NI 43-101
Independent Technical Report on the Lemphane Kimberlite Project, Lesotho.” and dated October
th
28 2010 relating to the Lemphane property. I visited the Lemphane property on 9th October
2010.
7. I have had no prior involvement with the property which is the subject of the Technical Report.
Lemphane Project
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8. I am not aware of any material fact or material change with respect to the subject matter of the
Technical Report that is not reflected in the Technical Report, the omission to disclose which
makes the Technical Report misleading.
9. I am independent of the issuer applying all of the tests in section 1.4 of National Instrument 43101.
10. I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report has been
prepared in compliance with that instrument and form.
11. I consent to the filing of this Technical Report with any stock exchange and other regulatory
authority and any publication by them, including electronic publication in the public company files
on their websites accessible by the public, of this Technical Report.
th
Dated this 28 day of October 2010.
……………………………………………….
Dr Frieder Reichhardt, Pr.Sci.Nat., GSSA
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24
GLOSSARY OF TECHNICAL TERMS
aeolian
an adjective to describe a sediment transported and
deposited by wind
aeromagnetic survey
Surveys flown by helicopter or fixed wing aircraft to
measure the magnetic susceptibility of rocks at or near
the earth’s surface. Kimberlite may be detected by these
surveys.
alkaline rock
an igneous rock containing an excess of sodium and or
potassium
alluvial
Transported and deposited in a river system, e.g.
diamonds eroded from kimberlites and deposited in river
gravel.
Archaean
The oldest rocks of the Precambrian era, older than
about 2 500 Ma.
artisanal
Adjective to describe mining by workers operating
without substantial capital, technical skills or training.
ASTER
Advanced Spaceborne Thermal Emission and Reflection
Radiometer) is an imaging instrument flying on Terra, a
satellite launched in December 1999 as part of NASA's
Earth Observing System.
basalt
A common volcanic rock, dark and fine grained, relatively
low in silica. May form very extensive lava flows.
basement
The igneous and metamorphic crust of the earth,
underlying sedimentary deposits.
bedrock
the first hard and solid rock underlying soil or
unconsolidated overburden
breccia
A coarse grained rock made up of large angular
fragments, sometimes of various rock types.
In
kimberlite geology, often the filling of a kimberlite pipe
made up of country rock fragments enveloped in
kimberlite. The fragments may be transported within the
pipe (an intrusive breccia) or essentially in-situ (an
intrusion breccia).
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brecciated
Adjective applied to an intensely fractured body of rock.
bulk sample
a large sample, at least a hundred tonnes, usually
excavated mechanically
carat
Standard unit of diamond weight, 1 carat = 0.2 grams
carbonate
A rock, usually of sedimentary origin, composed primarily
of calcium, magnesium or iron and CO3. Essential
component of limestones and marbles.
caustic fusion
A laboratory method for achieving total liberation and
recovery of the diamonds (and other resistant minerals)
from kimberlite down to microscopic sieve sizes by
means of fusing the rock with sodium hydroxide, which
destroys the silicate phases and leaves a small residue
of resistate, in which will be found any diamonds present.
CIM
Canadian Institute of Mining, Metallurgy and Petroleum
core drilling
Method of obtaining cylindrical core of rock by drilling
with a diamond set or diamond impregnated bit. For
drilling of diamond deposits bits with synthetic rather
than natural diamonds are used, to avoid possible
contamination.
chrome diopside
A calcium, magnesium silicate, Ca(Mg,Fe,Cr)(Si,Al)2O6,
with a high proportion of chromium substitution in the
lattice, which is a common indicator mineral for diamond.
chromite
An oxide of chromium, (Mg,Fe)Cr2O4, some varieties of
which can occur in kimberlite.
colluvium
Sediment transported downslope by gravity; usually
proximal to its source.
conglomerate
A rock type composed predominantly of rounded
pebbles, cobbles or boulders deposited by the action of
water.
craton
Large, and usually ancient, stable mass of the earth’s
crust comprised of various crustal blocks amalgamated
by tectonic processes. A cratonic nucleus is an older,
core region embedded within a larger craton.
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Cretaceous
Applied to the third and final period of the Mesozoic era,
141 Ma to 65 Ma ago.
ct/100 t
Carats per hundred tonnes.
A common way of
expressing the grade of diamonds in a deposit.
ct/m
3
carats per cubic meter. A common way of expressing
the grade of diamonds in a deposit, sometimes favoured
because it does not require an estimation of rock density.
dense media separation
DMS a process where a suspension of dense powder
(ferrosilicon in diamond plants) in water is used to form a
type of ‘heavier liquid’ to separate mineral particles in a
sink-float process.
diamond drilling
synonymous with core drilling
diamond size frequency
distribution
A cumulative plot of the percentage of stones found in
each size fraction of a parcel. Confidence in the
sampling results is obtained when multiple samples of
the same deposit display similar curves. The curve also
provides information regarding the overall value of the
parcel. For example, a higher percentage of large stones
will provide a higher value to the overall parcel.
diatreme
A volcanic vent created by gaseous magma sourced
from the mantle. A common mode of occurrence of
kimberlite and often referred to as a pipe.
DMS
Dense Media Separation. A technique to produce a
diamond bearing concentrate.
DMS yield
The proportion of material reporting to the concentrate
from a DMS process. Expressed as a percentage.
dyke
A vertical or near vertical sheet of igneous rock, the
widths of which may range from centimeters to hundreds
of meters. One of the typical modes of occurrence of
kimberlite, in the case of which widths are usually
narrow, less than 2 m.
Ecart probable (Ep)
Measure of the efficiency of a density separation device.
Defined as half the differential in density between the
75% and 25% coefficient. The lower the Ep, the better
the separation.
EIA
Environmental Impact Assessment.
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eluvium
Sediment derived from the physical and/or chemical
decomposition of the underlying bedrock.
EMP
Environmental Management Plan.
Equator Principles
A set of voluntary governance rules for managing social
and environmental risk in project finance (see
www.equator-principles.com).
facies
The sum of the lithological (and palaeontological)
characters of a particular rock. In the case of kimberlite
there are usually four facies recognized – hypabyssal,
diatreme, crater and transitional. Specific facies may also
be identified with particular caharcteristics.
fault
A fracture or fracture zone, along which displacement of
opposing sides has occurred.
G9
A type of red to purple pyrope garnet often found in both
diamond bearing and non diamond bearing kimberlite.
G10
A type of lilac-coloured pyrope garnet often associated
with diamond bearing kimberlite.
Ga
Giga years (1 Ga = 1,000 million years)
garnet
A silicate mineral with many varieties.
Specific
compositions can be related to depths and pressures of
formation, eg pyrope garnets are chrome rich and are
common in kimberlite, and are a kimberlite indicator
mineral.
geophysical surveys
Instrumental surveys measuring small variations in the
earth’s magnetic field, gravity field electrical conductivity
or other proprties related to local variations in rock type.
Widely used to discover kimberlite pipes. Magnetic and
some electrical methods can be carried out from an
aircraft, whereas gravity surveys are most commonly
conducted using ground based surveys.
Gondwana
The southernmost of two supercontinents that existed
during the Mesozoic comprising what are today Africa,
Australia, South America, India and Antarctica
gneiss
A coarse grained, banded, high grade metamorphic rock.
GPS
Global Positioning System. A satellite based navigation
system able to give real time positions to approx ±5 m.
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grease table
A device for recovering diamonds in a treatment plant
using grease, to which the diamonds preferentially
adhere due to their hydrophobic properties.
ha
Hectare = 10,000 m . A common unit for expressing the
surface area of a kimberlite pipe.
harzburgite
An ultramafic igneous rock comprising the minerals
olivine and orthopyroxene. Harzburgite is an important
component of the Earth’s mantle.
hypabyssal
An adjective for an igneous rock, e.g. kimberlite, which
has crystallized from a melt within the earth’s crust, but
at relatively shallow depth.
ilmenite
An iron, magnesium and titanium oxide ((Fe,Mg)TiO3).
The magnesium-rich ilmenite in kimberlite is called picroilmenite.
Indicated Resource
An Indicated Mineral Resource is that part of a mineral
resource for which quantity, grade or quality, densities,
shape and physical characteristics, can be estimated
with a level of confidence sufficient to allow the
appropriate application of technical and economic
parameters, to support mine planning and evaluation of
the economic viability of the deposit. The estimate is
based on detailed and reliable exploration and testing
information gathered through appropriate techniques
from locations such as outcrops, trenches, pits, workings
and drill holes that are spaced closely enough for
geological and grade continuity to be reasonably
assumed. (CIM definition).
(Indicated Mineral
Resource)
2
indicator minerals
A suite of resistant minerals with an origin and mode of
occurrence similar to diamond, that can be indicative of
the presence of primary diamond deposits.
Inferred Resource
An Inferred Mineral Resource is that part of a mineral
resource for which quantity and grade or quality can be
estimated on the basis of geological evidence and limited
sampling and reasonably assumed, but not verified,
geological and grade continuity. The estimate is based
on limited information and sampling gathered through
appropriate techniques from locations such as outcrops,
trenches, pits, workings and drill holes. (CIM definition).
(Inferred Mineral
Resource)
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isotope dating
A method of dating rocks by quantifying the relative ratio
of isotopes.
joints
Regular planar fractures or fracture sets in massive
rocks, usually created by unloading, along which no
relative displacement has occurred.
Jurassic
Second period of the Mesozoic Era, 190 to 141 Ma ago
Kalahari
An extensive tract of flat, featureless sand savanna,
mainly devoid of perennial surface water, which takes up
all of central and western Botswana, in addition to areas of
South Africa, Namibia, Angola, Zimbabwe and Zambia.
kelyphyte
An alteration rim on the surface of (pyrope) garnets in
kimberlite resulting from reaction with kimberlite magma at
depth or phase transformation reactions in peridotitederived pyrope garnets.
kimberlite
An alkaline ultramafic igneous rock that is generated at
great depths in the earth and emplaced at the surface in
pipes (diatremes), dykes or sills. The principal source of
primary diamonds.
KIM
Kimberlite Indicator Mineral: pyrope garnet, eclogitic
garnet, picro-ilmenite, chromite and chrome diopside.
These are distinctive resistive minerals which occur in
kimberlite in much higher concentrations than diamond,
and which can be found in streams and soils and traced
back to their kimberlite source, thus acting as pathfinders
for diamond. The chemical compositions of garnet,
ilmenite and chromite are related to the diamond
potential of their source kimberlites, thus their mineral
chemistry can provide an initial, non quantitative, grade
prognosis.
kriging
A mathematical technique which uses spatial statistics to
calculate estimations of mineral resources.
LDD
Large diameter drilling.
diameter >15"
lamproite
A peralkaline volcanic or subvolcanic rock of mafic to
ultramafic composition.
Rarely, lamproite contains
diamonds in economic quantities.
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lherzolite
An ultramafic igneous rock containing the mineral olivine,
clinopyroxene and orthopyroxene. Lherzolite is though to
be a major constituent of the Earth’s upper mantle.
limestone
A sedimentary rock containing at least 50% calcium or
calcium-magnesium carbonates.
lineament
A significant linear feature of the earth’s crust.
lithosphere
Mass of the mantle attached to the base of the crust that
has a geological history related to that of the overlying
crust, and that is cold and rigid relative to the deeper
parts of the mantle.
loam sampling
Sampling the soil profile to recover resistant minerals. In
the case of diamond exploration, loam sampling is
intended to recover kimberlite indicator minerals.
luminescence intensity(li)
Measure of the fluorescence of diamond when
bombarded with X-rays. The fluorescence is caused by
impurities or crystallographic dislocations in the diamond.
Ma
Million years.
mafic
Descriptive of rocks composed dominantly of magnesium
and iron rock-forming silicates.
magmatic
Rock formed from crystallization of molten magma; an
igneous rock. A descriptive of some kimberlite types
which have crystallized without exploding.
magnetic survey
A geophysical survey which measures variations in the
earth’s magnetic field caused by differences in the
magnetic susceptibilities of underlying rock. Kimberlite
may be detected by this method, as its susceptibility may
be higher or lower than surrounding rock types.
mantle
The layer of the earth between the crust and the core.
The upper mantle, which lies between depths of 50 and
650km beneath continents, is the principal region where
diamonds are created and stored in the earth.
Measured Resource
A Measured Mineral Resource is that part of a mineral
resource for which quantity, grade or quality, densities,
shape and physical characteristics are so well
established that they can be estimated with confidence
sufficient to allow appropriate application of technical and
(Measured Mineral
Resource)
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economic parameters, to support production planning
and evaluation of the economic viability of the deposit.
The estimate is based on detailed and reliable
exploration, sampling and testing information gathered
through appropriate techniques from locations such as
outcrops, trenches, pits, workings and drill holes that are
spaced closely enough to confirm both geological and
grade continuity. (CIM definition).
metamorphism
Alteration of rock and changes in mineral composition,
most generally due to increase in pressure and/or
temperature.
macrodiamond
Definitions vary, but a diamond which would be recovered
in a full scale mine plant. Now generally taken as
>0.85 mm in size.
“microdiamond”
A diamond <0.5 mm in size, although definitions vary.
Usually considered to be of no commercial value and too
small to be recovered in a full scale mining operation.
mobile belt
An elongate belt in the earth’s crust, usually occurring at
the collision zone between two crustal blocks, within which
major deformation, igneous activity and metamorphism
has occurred.
ore dressing
Another term for mineral processing. The process of
recovering the valuable minerals from an ore.
orogeny
A deformation and/or magmatic event in the earth’s crust,
usually caused by collision between tectonic plates.
Palaeozoic
An era of geologic time between the Late Precambrian
and the Mesozoic era, 545 Ma to 251 Ma ago.
paragenesis
The origin of a mineral in the context of associated
minerals and their common history.
petrography
The description and classification of rocks.
Percussion drilling
Drilling by means of an air hammer which breaks the rock
into chips which are brought to surface by air circulation.
Precambrian
Pertaining to all rocks formed before Cambrian time (older
than 545 Ma).
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Probable Reserve
(Probable Mineral
Reserve)
Proven Reserve
(Proven Mineral Reserve)
A Probable Mineral Reserve is the economically mineable
part of an Indicated, and in some circumstances a
Measured Mineral Resource, demonstrated by at least a
Preliminary Feasibility Study. This study must include
adequate information on mining, processing, metallurgical,
economic and other relevant factors that demonstrate, at
the time of reporting, that economic extraction can be
justified. (CIM Definition)
A Proven Mineral Reserve is the economically mineable
part of a Measured Mineral Resource demonstrated by at
least a Preliminary Feasibility Study. This study must
include adequate information on mining, processing,
metallurgical, economic and other relevant factors that
demonstrate, at the time of reporting, that economic
extraction is justified. (CIM Definition).
Proterozoic
An era of geological time spanning the period from
2 500 Ma to 545 Ma before present.
pipe
When referring to kimberlite, a synonym of diatreme.
PL
Prospecting Licence
pyrope garnet
A ruby-coloured garnet, Mg3Al2(SiO4)3, common in deepseated ultramafic intrusive rocks and common as a
xenocryst in kimberlite.
RC drilling
Reverse circulation drilling.
A percussion drilling
technique in which the sample is brought to surface by air
and/or water through the centre of the drill pipe. Used
when accurate sampling is required as the method
minimizes cross contamination of samples.
retroarc foreland basin
An orogenic basin that forms on the overriding plate of a
subduction plate boundary.
schist
A crystalline metamorphic rock having a foliated or parallel
structure due to the recrystallisation of constituent
minerals.
SAMREC
The South African code for the reporting of exploration
results committee
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slimes
The term for a mixture of undersize material and water
which is removed from crushed ore during processing.
spinel
A group of oxide minerals of various compositions,
(Mg,Fe,Mn)(Al,Fe,Cr)2O4, commonly occurring as an
accessory in basic igneous rocks.
stream sediment sampling
The collection of samples of stream sediment with, in
diamond exploration, the intention of looking for
kimberlite indicator minerals or diamonds.
strike
Horizontal direction or trend of a geological structure.
Tertiary (System)
The rocks formed between the end of the Cretaceous at
65 Ma and the start of the Quarternary at 1.7 Ma.
tonne
A metric tonne, 1,000 kg
tectonic
Pertaining to the forces involved in, or the resulting
structures of, movement in the earth’s crust.
type IIa diamond
Very pure type of diamond containing very little nitrogen.
Type IIa diamonds may have higher values than other
stones, but have much lower luminescence under Xrays, which makes them more difficult to recover using
X-ray technology.
volcaniclastic
Rock formed by exploding magma in a volcano.
Volcaniclastic kimberlite is common in kimberlite pipes.
ultramafic
Igneous rocks consisting essentially of ferromagnesian
minerals with trace quartz and feldspar.
variogram
In spatial statistics, a graph which relates the variance of
the difference in value between pairs of samples to the
distance between them. Allows the weighting of a
sample value in terms of its distance from the point
where an estimate of sample value is required.
xenocryst
Applies to mineral crystals in igneous rocks that are
foreign to the body of rock in which they occur. Very
common in kimberlite, with diamond being an example.
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X-ray machine
Diamond recovery technology utilizing the fact that
diamonds fluoresce and to some degree phosphoresce
when exposed to X-Ray radiation. Light emitted from
diamonds which have been excited by X-rays is detected
and converted into electrical signals. Such signals (after
suitable amplification and processing) trigger an ejection
device which physically separates the diamond from the
rest of material fed through such a sorting machine.
xenolith
A piece of another pre-existing rock within an igneous
intrusion. Very common in kimberites.
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