DIAMOND PAGE — Diamond Fields finances work off Namibian coast

A private placement of 5.6 million shares at a price of US30 cents each has netted US$1.7 million for privately owned Diamond Fields International.

Proceeds will be used to resume exploration of the wholly owned Luderitz marine diamond concessions, off the coast of Namibia.

Diamond Fields International was formed to hold the diamond assets of Diamond Fields Resources, which was acquired by Inco in August 1996.

In 1994 and 1995, bulk-sample drilling was carried out by a 120-metre-long vessel in the deeper areas of the Luderitz concession. Twelve areas were selected for reconnaissance drilling, representing 239 sq. km, or 36%, of the 660-sq.-km concession.

Follow-up drilling focused on five areas selected for their geological characteristics and potential. Of the 882 holes completed within a depth range of 30 to 129 metres, 26% were found to be diamondiferous. In total, 641 diamonds weighing 216.4 carats were recovered. The average stone size was 0.34 carat, with an estimated value of US$165 per carat.

No diamonds were recovered from waters deeper than 80 metres.

Based on the bulk-sampling results, an indicated and inferred resource was estimated at 1.1 million carats for an area of 8.4 sq. km, representing 1.7% of the concession.

The sampling program indicated variable seabed characteristics and the presence of overburden in the centre of Luderitz Bay. The presence of phosphatic rubble in certain deeper water areas of the concession made sampling difficult and could render diamond retrieval uneconomic.

To determine the potential for additional resources, further bulk sampling is required in the deeper waters, as well as in the shallow waters of fewer than 30 metres.