After having once given up its Pimenta Bueno diamond property in Brazil to the benefit of Toronto-based
The property is in one of South America’s most-active diamond camps, 70 km southeast of the town of Pimenta Bueno in western Brazil’s remote Rondonia state, near Bolivia. About 15 km to the northeast of Vaaldiam’s ground lies the Roosevelt Indian Reserve, where two diamond-rich kimberlite pipes were discovered along the Lajes River over the past three years and are now being exploited by artisanal miners.
Rio Tinto explored the Pimenta Bueno area from 1994-1996, found 13 kimberlite pipes on the property, but soon pulled out during the commodities downturn.
Vaaldiam acquired the property from a Brazilian firm in 2000 and then bought Rio Tinto’s data in 2003. Subsequent grassroots exploration by Vaaldiam has proven fruitful, with the total number of known kimberlite pipes now standing at 33.
Rio Tinto re-entered the camp in November 2003 by signing a joint-venture agreement with Vaaldiam.
Now, by exercising its option rights, Rio has committed to spend US$5 million over three years in the southern two-thirds of the property and US$7.5 million in the northern one-third over the same period.
At least US$1.5 million and US$2.5 million must be spent during the first year in the southern and northern blocks, respectively.
Rio Tinto also has the right to increase its interest to 70% by completing a bankable feasibility study on any kimberlite deposit on the property.
Vaaldiam has been busy delineating several kimberlites, the latest being Pepper 4 (where five of seven holes cut kimberlite). Of the five holes, three were vertical and two were angled at 45. The holes intersected 75 to 164 metres of tuffisitic kimberlite breccia. All ended in kimberlite. In total 584 metres of kimberlite core, weighing an estimated 2.7 tonnes, was sampled.
The Pepper 4 pipe has a minimum surface area of seven hectares and is covered by about 30 metres of sandstone. The pipe is composed of at least two types of diatreme facies kimberlite. The holes defined the southern and eastern margins of the pipe; the northern and western margins remain open.
The 1,760-sq.-km Pimenta Bueno property hosts at least 33 kimberlite pipes, 15 of which are known to be diamond-bearing.
The seven Pepper kimberlite pipes lie within a 2.5-km radius. An ongoing drilling program is attempting to delineate each pipe with five to six drill holes. A few tonnes of kimberlite will be collected from each pipe for microdiamond analysis.
The first hole in the Pepper 13 pipe, 100 metres west-northwest of Pepper 4, has cut kimberlite at 23.5 metres down-hole and is still in kimberlite at 138 metres depth.
Vaaldiam continues to explore for additional pipes on the property.
The company will regain 100% ownership in the property should Rio Tinto decide to discontinue investment prior to meeting the expenditure requirements of the option.
Vaaldiam also retains the right to develop any diamond deposit that does not meet Rio Tinto’s development criteria.
In addition, Vaaldiam is performing due diligence on the 70-sq.-km Duas Barras alluvial diamond property, 150 km north of the town of Diamantina, in Minas Gerais state. The company may earn a 70%-interest in the property from Brazilian-based Minerao Marly. A mobile diamond-recovery plant capable of processing 10 cubic metres of gravel per hour will test samples from the site.
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