The recent acquisition of
Black Swan submitted a US$1-million winning bid for the assets of Mineracao do Sul. An economic review of the Canastra-1 project in 2000 failed to meet De Beers’ investment criteria and so the Brazilian subsidiary was put up for sale by tender. The US$1-million payment will be made in stages over the next 12 months.
Black Swan has enlisted IBK Capital to assist the company with a private placement financing of up to 12.5 million shares plus a half warrant at a price of 21, for total proceeds of $2.6 million. A whole warrant will buy an additional share at 25. The company arranged a similar $777,000 financing with Williams de Broe of London in June; it consisted of 3.2 million units. Black Swan has 68.9 million shares outstanding.
The company insists it has the infrastructure and experience needed to develop the Canastra-1 kimberlite at a profit. Set in a steep canyon in the Serra da Canastra region of Minas Gerais state, Canastra-1 was extensively drilled by De Beers and later bulk-sampled. Deeply incised topography and restricted valleys characterize much of the Serra da Canastra region.
The Canastra-1 pipe is just under 1 hectare and has been drilled to a vertical depth of 100 metres. According to Black Swan spokesman Val Mazur, an initial 700-tonne bulk sample returned a grade of 0.42 carat per tonne. This was followed up with a much larger 20,000-tonne test sample, which yielded a grade of 0.28 carat per tonne.
A recovered 5,083-carat parcel of diamonds has an average value of around US$120 per carat, says Mazur. The stones are described as “largely glassy octahedrals.”
The company’s first order of business is to check the quality of De Beers’ processed kimberlite tailings from Canastra-1. The tailings are stored in 1,300 drums on site.
Licensing applications are under way to a conduct a trial mining program using the company’s 15-tonne-per-hour dense-media-separation plant, which will be moved from its current site on the Paranaiba River at Marques to Canastra. An exploration program is being drawn out to test neighbouring kimberlites and geophysical targets already identified. Black Swan received De Beers’ complete geological database, including airborne and ground magnetic surveys, heavy mineral sampling results, drilling data and mineral chemistry analysis. Among the known kimberlite bodies are five pipes with surface areas of between 1.3 and 21 hectares. Black Swan intends to identify the most interesting kimberlites with further indicator mineral sampling in preparation for drilling.
The acquisition of De Beers’ Brazilian subsidiary has effectively doubled the company’s land holdings in the Serra da Canastra region. The licence area now extends over an 80-by-30-km area, surrounding the Serra da Canastra National Park. The area is accessible by dirt roads from the small towns of Sao Roque de Minas, on the east side of the park, Delfinopolis, on the south side, and Desemboque or Tapira, on the north side. With the exception of Sao Roque de Minas, each of these towns is accessible to major centres by paved highway.
In the meantime, the company continues to test its alluvial diamond properties along the Santo Antonio do Bonito River, where 77 sq. km of licences are held. This summer, three large stones weighing 27.4, 2 and 0.6 carats were recovered from an alluvial test pit. The 27.4-carat gem stone was sold uncut for US$900 per carat. Since May, the company has completed 10 core holes totalling more than 700 metres while testing several potential kimberlite sources.
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