Liqhobong Production and Development Project
The Liqhobong diamondiferous kimberlite pipes were discovered in the late 1950's by Col Jack Scott, who also discovered the Letseng-le-Terai mine. In 1978, a small scale artisanal mining operation was commenced by the Liqhobong Co-operative. This operation continued for eighteen years until 1996, during which period, some 93,000 tonnes were mined producing 33,000 carats. This production included a 22 carat blue-white stone from the Satellite Pipe and a 32 carat blue-white stone from the Main Pipe.
In 1996, MineGem, a Canadian junior mining company, acquired the property and conducted drilling and bulk sampling programmes for both pipes. In 2001, Bateman Engineering Limited and SRK carried out a feasibility study for the Satellite Pipe. In 2003, Kopane acquired MineGem and immediately commenced the implementation of the Satellite Pipe project.
The Satellite Pipe has a surface area of approximately one hectare. It is estimated that the average grade of production is 68 carats per hundred tonne. The average stone value is approximately $44/carat, at September 2008 prices. This value is before recent falls in the prices of rough diamonds as a result of the world economic situation. When mining commenced in 2005, the pipe had an initial mine life of approximately 5 years, of which some 2.5 years remain. Mining is straightforward truck and shovel and has been contracted out to a local company.
Satellite Pipe production has provided a number of important benefits to Kopane. It has generated a cash contribution to LMDC, has permitted the parallel appraisal and rediscovery of the Main Pipe, has demonstrated Kopane's ability to build and operate a mine in a challenging physical environment and has facilitated the award of a 20 year Mining Licence for the Main Pipe to LMDC.
The Liqhobong Plant, which came into production at the end of 2005, was designed to process kimberlite mined from the Satellite Pipe at a throughput capacity of 420,000 tonnes/year. It has however been used to process some 77,000 tonnes of Main Pipe bulk samples in 2006, 2007 and 2008 and in recent months it has been processing material from both pipes until suspension of production at 1 December 2008.
Prior to suspension of production the Liqhobong Plant was running at a rate of 420,000 tonnes/year while treating weathered Main Pipe kimberlite ahead of the bulk sampling.
The Liqhobong Plant provides LMDC with several important advantages in addition to the generation of a useful cash contribution. It provides both an industrial-scale plant for Main Pipe bulk sampling and a superb training facility for operating personnel.
The Main Pipe, which is located 300 metres from the Satellite Pipe, has a surface of 8.6 ha. Kopane has completed the PFS which demonstrated the economic viability of the pipe to an appropriate level of accuracy and has now commenced the DFS. This is expected to be completed in 2009.
Three separate bulk samples have been recovered from the Main Pipe: