DIAMOND PAGE — SouthernEra writes off alluvial operations

Toronto-based SouthernEra Resources (SUF-T) has ceased operations at the Lou and Cassanguidi alluvial diamond concessions in Angola’s Lunde Norte province.

Both projects have been rendered marginal, owing to decreasing diamond recoveries, ballooning security costs and logistical difficulties in replenishing supplies. The company will write off the $7 million it has invested in the two projects and will no longer cover their operating costs. It will, however, receive 10% of future profits from either, should its partners resume production.

Production equipment at Lou will be transported to the nearby Camafuca project, where 15,000 tonnes of kimberlite have been extracted from five trenches. The composite sample will be processed in an on-site test plant to verify historical results from the 1980s. As well, core from 3,000 metres of drilling recently completed by the company is being transported to South Africa for processing.

SouthernEra owns a 51% interest in Camafuca and is focusing its efforts on a high-grade area estimated to contain 8.7 million carats diamonds in 26 million cubic metres of a kimberlite pipe. The resource calculation includes material from surface to a depth of 80 metres.