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Angola gained its independence from Portugal in 1975 and a period of civil war followed until sustained peace was achieved in February 2002. Portuguese remains the lingua franca. It is currently the largest recipient of foreign direct investment in sub-Saharan Africa. Since the end of the war Angola has re-established itself within the top five global diamond producing countries with estimates of current annual diamond production well in excess of 5 million carats. The state-owned diamond company ENDIAMA, E.P. holds up to 51% of all mining licenses and the only legal sale of diamonds is through state-owned SODIAM.
A Cooperation Agreement for the evaluation of the Chiri kimberlites in the Lunda Sul province of Angola was signed in January 2007 with Avantis Angola Limited, one of the companies in a joint venture granted exploration rights over the two Chiri kimberlites. The agreement provides for an option to purchase a share in Avantis equivalent to 11.25% of the total Chiri Project.
Chiri is located approximately 12 kms from Catoca, one of the world's largest diamond mines and amongst a cluster of other known kimberlites. Its added attraction is that the kimberlites are exposed in part at surface reducing the stripping costs associated with mining a kimberlite.
Gem Diamonds has signed a contract with a geological consulting and contracting company to manage the preliminary evaluation programme and feasibility studies over Chiri under Gem Diamonds' direction. The preliminary evaluation programme comprises ground geophysics, diamond drilling, large diameter drilling, bulk sampling and analysis of mantle geochemistry and fine diamond content. Project and Logistics managers were recruited in 2007 and are based in Luanda where an office has been established. Camp and geophysical equipment are being readied for shipment to site together with a 10 tph DMS sampling plant. A large diameter Prakla RB 40 drill rig is being shipped to Namibia for testing prior to dispatch to the project and a diamond drilling contractor has been mobilized.
The preliminary feasibility report, the result of this evaluation programme is expected in the fourth quarter of 2008.
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