Ventersdorp yields gem quality stones

Small-scale contract mining on the Ventersdorp alluvial diamond project’s Hartbeestlaagte 146 property, one of a group of three properties under the Ventersdorp banner, has yielded a total of 3,948 gem quality diamonds weighing 4,293 carats since February 2000, for partners Etruscan Resources (EET-T) and Mountain Lake Resources (MOA-V).

The stones average 1.09 carats in weight and US$400 per carat in value. The largest diamond recovered to date on the Hartbeestlaagte 146 property weighed in at 16.5 carats.

Mining in sixteen pits across a 3-km portion of the 15-km-long East Run alluvial gravel deposit returned gem quality stones from each pit, including individual stones exceeding 5 carats. The program will continue to test other areas of the deposit.

So far, 252,000 tonnes of gravel have been processed with the diamond grade, based on surveyed volumes and declared diamonds, coming in at 1.7 carats per 100 tonnes. Etruscan’s initial economic model pegged the grade at 1.6 carats per hundred tonnes and the average value at US$400 per carat.

Meanwhile, at the Nooitgedacht 131 property, construction has begun on the partners’ initial phase 1.2-million-tonne-per-year gravel processing and diamond recovery plant. The plant will include a 200-tonne-per-hour screening and scrubbing circuit plus a 50-tonne-per-hour dense media separation plant and final x-ray (Sortex) recovery room

The partners plan call for the optimization of the mining and processing methods of the gravels in the initial phase followed by an expansion to develop all of the Ventersdorp district deposits, including additional plants.

The plant is expected to reach design capacity in the third quarter of 2002 with projected annual output of 19,200 carats of gem quality diamonds.

Historically, the seven concessions situated about 150 km west of Johannesburg have yielded about 50,000 carats of diamonds. Individual diamonds weighed up to 19 carats. Previous work by Mountain Lake and Ashton Mining of Australia indicated a resource of 14.5 million tonnes of gravel with a historical average grade of 1.5 carats per 100 tonnes.

Etruscan says that based on historic records, it expects that up to 20% of the diamonds recovered from the mine will weight more than 5 carats. The largest stone recorded from the Ventersdorp group in recent times weighed 27.9 carats.

Earlier this year, Etruscan completed a private placement for proceeds of US$1.32 million, which it used to acquire a 75% interest in Mountain Lake’s wholly owned subsidiary Mountain Ash, which owns seven concessions about 150 km west of Johannesburg in the Republic of South Africa.

Three of the concessions — Nooitgedacht 131 IP, Hartsbeestlaagte 146 IP and Zwartrand 145 IP make up the partners’ Ventersdorp project.

Under the placement, Etruscan issued 300,000 common shares, 150,000 non-transferable share purchase warrants plus the right to receive 100 Class A shares of a subsidiary set up to hold Etruscan’s stake in Mountain Ash. One warrant allow the holder to buy one Etruscan share for 75 anytime before Jan. 11, 2004.