Firestone targets quality diamonds
Management at the new $185m Liqhobong diamond mine in Lesotho, 75% owned by Firestone Diamonds, is trying to deal with the issues that had led to a disappointing first year of operations, which resulted in the need for a capital raising and a call to the bank to restructure its debt.
Management at the new $185m Liqhobong diamond mine in the mountains of Lesotho is trying to tackle the issues resulting in a disappointing first year of operations, resulting in the need for a capital raising and a call to the bank to restructure its debt.
Liqhobong is 75% owned by Firestone Diamonds, an Alternative Investment Marketstraded firm in London headed by former De Beers chief financial officer and joint CE Stuart Brown, who is candid as to the reasons why the mine has not performed to expectations and what needs to be done.
Firestone has implemented a plan that sliced off a third of the mine’s 15-year life as management seeks the higher-value part of the kimberlite deposit, which is an ancient carrotshaped volcanic pipe carrying diamonds to the earth’s surface from deep within the crust.
Liqhobong is close to Gem’s Letseng diamond mine, which is famed for producing large diamonds. However, breakages and the quality of the diamonds coming from the kimberlite Firestone first started mining meant it had not delivered the high-value diamonds its neighbour has and on which management was counting.
Firestone has banked on finding diamonds as large as 200 carats to 300 carats.
“It would be so fantastic to find some of those. It would solve so many issues,” said Brown. “Everything for us is going well. We’ve got to improve the grade slightly, get betterquality stones and limit the breakages of diamonds, not that we think it’s an extraordinary problem but it’s clearly something that’s lowering the value.
“Percentage-wise, our breakages are within industry norms. We’ve seen a bit of an uptick over the last few months, but statistically the ones we are breaking are the diamonds that are valuable,” he said. Experts had been brought in to handle the problem, he said.
Brown said there was a high level of advice shared between Firestone and Gem.