Botswana Diamonds has obtained a mining permit for the Thorny River project in Limpopo, South Africa, allowing potential production. Extensive geological exploration suggests promising results similar to past operations. Shares rose initially but later fell, reflecting market reactions. The company’s future operations will hinge on diamond prices and market conditions.
Botswana Diamonds (LON: BOD) has successfully obtained a mining permit for its Thorny River project, located in South Africa’s Limpopo province. This development enables the company to advance towards potential production, succeeding previous operations at the nearby Marsfontein diamond mine.
The Thorny River site has been extensively explored through geological means, including geophysics, drilling, and bulk sampling. Preliminary findings indicate that the geology and grade of the diamonds may be similar to those extracted from the historically productive Klipspringer mine.
Previously, Botswana Diamonds managed operations at the Marsfontein project, generating a 15% revenue royalty during its proof-of-concept phase. However, due to falling diamond prices and delays in obtaining necessary permits, the Marsfontein project was placed on care and maintenance as of October 2023.
With the newly acquired mining permit at Thorny River, Botswana Diamonds plans to initiate contractor mining, depending on prevailing market conditions. In the event of a recovery in diamond prices, the company may also consider restarting operations at Marsfontein alongside ramping up efforts at Thorny River.
The market reacted positively to the news, resulting in a surge in shares of Botswana Diamonds during early London trading. However, by the afternoon, the shares experienced a decline of 2.6% to 0.13 pence, placing the company’s market capitalization at approximately £1.5 million ($1.9 million).
Botswana Diamonds has secured a mining permit for the Thorny River project, positioning itself for potential production amid recent operational changes. Despite market volatility, the company remains optimistic about the future, particularly if diamond prices recover. The strategic focus on Thorny River, combined with the experience from Marsfontein, indicates a proactive approach to diamond mining in South Africa.
Original Source: www.mining.com
