AFRICA — Rupert tests South African pipe

A deep-seated multi-phase kimberlite pipe at the former-producing Crown diamond mine in South Africa is the target of a 7-hole, 5,000-metre program of delineation drilling by Rupert Resources (RUP-V).

The Vancouver-based junior can earn up to a 75% interest in the subsurface mineral portion of the mine and up to a 50% interest in a tailings reprocessing project.

Situated 200 km southwest of Johannesburg and 25 km northwest of Kroonstad, the property is accessible by paved and gravel roads. The Crown mine operated intermittently from 1902 to 1931, producing 701,346 carats from the treatment of almost 4.5 million tonnes of kimberlite, which equates to a recovered grade of 0.157 carat per tonne, or 15.7 carats per 100 tonnes. The largest diamond recovered was reported to have weighed 86.5 carats. The mine closed during the Great Depression as a result of poor diamond market conditions and never reopened.

De Beers Consolidated Mines acquired the mine in 1939 and, last March, sold the inactive property to Potgieter Trust, an alluvial diamond miner.

The Crown kimberlite pipe was mined out by open-pit and underground chambering methods to a depth of 165 metres and partially mined to a depth of 240 metres. Prior to the mine’s closure, underground development on the 335-metre level uncovered a large “bulge” in the Crown pipe, representing as much as a 50% increase in the pipe’s area. The bulge was never sampled, though kimberlite material from development was brought to surface. The mine is currently flooded and the main shaft has collapsed near surface.

The Crown pipe is a multi-facie kimberlitic diatreme complex intruding basaltic lavas of the Ventersdorp formation and overlain by more than 100 metres of shale of the Karoo formation. Five different facies of kimberlite have been identified in the pipe, with a sixth facie, described as hypabyssal kimberlite, reported in the bulge.

Isolated dumps of what is believed to be hypabyssal kimberlite were sampled by De Beers, returning grades averaging 0.6 carat per tonne (60 carats per 100 tonnes) — approximately three times the grade of the main pipe. Recent sampling, by Rupert, of uncrushed hypabyssal kimberlite taken from the old tailings piles returned 19 macrodiamonds and 33 micros from a 49.52-kg sample, for a count of 3.8 macros per 10 kg. (A macro is defined as measuring greater than 0.5 mm in at least one dimension.)

The Crown pipe is roughly circular in shape, and, at surface, covers an area of 1.4 ha, increasing with depth to 2 ha at the 165-metre level. A second, smaller satellite pipe, 30 metres west of the main pipe, was discovered during mining operations in 1921.

The main portion of the pipe is estimated to contain a resource of 8.3 million tonnes to a depth of 440 metres grading 0.22 carat per tonne (22 carats per 100 tonnes). The satellite pipe contains an estimated 2.8 million tonnes from surface to a depth of 100 metres grading 0.14 carat per tonne (14 carats per 100 tonnes), and a further 2.2 million tonnes between 100 and 440 metres of depth grading 0.22 carat per tonne (22 carats per 100 tonnes).

The bulge was projected to contain a resource of 7 million tonnes to a depth of 440 metres, or 200 metres below the deepest level mined.

The resource estimates are based on rough estimates from historical reports and previous small-scale sampling programs conducted by De Beers, both on in situ kimberlite collected from the open-pit and on selected surface tailings dump material.

In a technical summary of the project, consulting geologist Barbara Henderson writes: “Diamond production from the Crown mine is stated to have consisted of good quality stones with a high proportion of inferior quality stones.

Most diamonds recovered were less than 1 carat, though numerous good quality stones of larger size were recovered, including fancy yellow and blue-white diamonds.”

Rupert is currently conducting a delineation drilling program designed to the test the extent of the potentially higher-grade “bulge” phase of the pipe.

The first hole of the program intersected a total of 212 metres of hypabyssal-phase kimberlite. Drilled to the north at an angle of minus 60, the hole encountered shale-rich kimberlite breccia beginning at a downhole depth of 599.6 metres and passed through a 20-metre-long interval of hypabyssal kimberlite between 647 and 667 metres, before cutting a further 191.5 metres of hypabyssal kimberlite starting at a 713.5-metre depth. The hole was shut down in hypabyssal kimberlite at a downhole depth of 905 metres, which is equal to a vertical depth of 800 metres below surface — some 560 metres below the deepest level mined.

The downhole interval between 647 and 905 metres represents a horizontal width of 129 metres and a vertical extent of 223 metres.

Partial microdiamond analysis of the first hole yielded 43 macrodiamonds and 154 micros from an aggregate of seven samples of hypabyssal kimberlite weighing 138.09 kg. The macro count is 3.1 macros per 10 kg. Of the 197 stones, 148 are described as “white transparent.”

In addition, a 17.85-kg sample collected from the shale-rich kimberlite breccia at a depth of 636 to 641 metres returned five microdiamonds.

The initial samples were recovered to a downhole depth of 771 metres. Results for the final 134-metre length of hypabyssal kimberlite are expected before February.

Drilling of holes 2 and 3 is in progress. Hole 2 is a vertically drilled stepout, 230 metres north of the first hole. Hole 3 has been collared 670 metres north of hole 1 and is being drilled to the south at an angle of minus 55.

An important aspect of the mine project is the reprocessing of the old tailing dumps. Rupert is carrying out a due diligence evaluation of the dumps by directing and monitoring the processing of some 200,000 tonnes of tailings through Potgieter Trust’s on-site 200-tonne-per-hour pan plant. At the beginning of December, the plant was recovering an average of 0.074 carat per tonne (7.4 carats per 100 tonnes), with operating cash costs estimated to be the equivalent of 0.025 to 0.03 carat per tonne (2.5 to 3 carats per 100 tonnes). Four small parcels of diamonds totalling 301 carats, which were recovered from the tailings, sold for an average of US$113 per carat.

The tailings were earlier estimated at 2.8 million tonnes averaging a grade of 0.1 carat per tonne (10 carats per 100 tonnes). A detailed survey of the dump piles has led Rupert to increase the tonnage estimate by 58% to 4.4 million tonnes, equivalent to 396,000 contained carats.

Rupert can purchase a 50% interest in the entire project, including underground resources and surface operations, for US$11.2 million — half in cash and half payable from project profits. The company has acquired an initial 5% interest in the overall project by making a US$500,000 downpayment as the first stage towards a 50% ownership. The agreement allows Rupert to increase its interest in the subsurface portion to 75%.

Rupert has 9.7 million shares outstanding, or 12.4 million fully diluted, and working capital of about $1.6 million.