Shares in London-listed Botswana Diamonds (LON:BOD) climbed as much as 24% after it announced that prospecting work at the Ontevreden licence, in South Africa, had identified a group 2 kimberlite pipe.
Initial indications show a size of 1.5 to 2.5 hectares in an area containing high interest garnets and further work will follow to see whether it contained commercial diamonds, the company said.
Ontevreden is close to the Petra Diamonds’ Helam diamond mine, which has a grade of 85 carats per hundred tonne (cpht).
“A new kimberlite discovery in an area where high grade kimberlites are being mined offers exciting prospects for the company,” the miner’s chairman John Teeling said in the statement. “This is excellent news.”
Botswana Diamonds stock climbed as much as 24% to 1.64 pence in morning trading and it was still up 17% to 1.55p in later afternoon trading.
Botswana, which was overtaken by Russia as the world’s top diamond producing country in 2014, is grappling with aging mines, as well as power and water shortages.
Besides diamonds, the nation also produces nickel, copper, coal and iron ore.