Glencairn Explorations signs letter of intent to fund diamond mine

The money would fund Glencairn’s Feijao Cru diamond property in Brazil to production. Glencairn has the right to earn a 50% interest in the Brazilian company which owns the property by placing the property in production. Glencairn estimates total costs to production at $700,000.

Geological reserves of diamond- bearing gravels estimated by the company stand at 425,000 cu m. This placer deposit is overlain by a thick blanket of overburden totalling 2.1 million cu m.

Based on a 540-cu-m bulk sample taken from a test pit, the average diamond grade was 1.24 carats per cu m. A majority of the diamonds recovered are gem quality and sell for $112(US) per carat. Mining costs for an open pit operation are estimated at $16 per cu m. Glencairn feels that once production begins, capital payback could take less than six months.

Glencairn also says that a rights offering made to shareholders was completely subscribed, netting the company $319,790. The cash will be added to working capital.

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