The Gahcho Kue diamond deposit in Canada’s Northwest Territories has an indicated resource of 50.5 million carats and an inferred resource of 10.3 million carats, Mountain Province Diamonds (MPV-T, MDM-X) reported today.
The news sent shares of the Toronto junior up 6.4% or 9 to close at $1.49 per share.
“This updated mineral resource statement is the culmination of a fourteen-year exploration and evaluation program and represents a major milestone in the development of the Gahcho Kue project,” Patrick Evans, Mountain Province’s president and chief executive, said in a statement.
According to AMEC Americas, the company which prepared the resource estimate, the scientific and technical data on Gahcho Kue is now of sufficient quality and detail to support a feasibility study, which the joint-venture partners are currently considering.
At a bottom cut-off of 1 millimetre — or one thousandth of a metre — Gahcho Kue has indicated resources of 30.2 million tonnes grading 167 carats per 100 tonnes and 6 million tonnes grading 173 carats per 100 tonnes in the inferred category, AMEC Americas reported.
Mountain Province Diamonds hold a 49% interest in the project and De Beers Canada owns the remaining 51%.
To assess reasonable prospects for economic extraction to support declaration of a mineral resource, diamond valuations were analysed and average mid-2008 pricing, with a 20% increase, was applied to the resource blocks.
All of the indicated mineral resources and a significant portion of the inferred resources were shown to have reasonable prospects of economic extraction through open-pit mining, the company says.
All the Gahcho Kue kimberlites remain open to depth.
Over the last year, Mountain Province Diamonds has traded in a price range of 73-$5.07 per share.
The Toronto-headquartered company has 59.93 million shares outstanding.
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