Gemfields mine in Zambia richer than initially thought

Gemfields mine in Zambia richer than initially thought

Photo by Duncan Pay © GIA | Courtesy of The Smithsonian Institution.

Emeralds and rubies miner Gemfields (LON:GEM) said Wednesday an independent report by consultancy firm SRK shows the Kagem mine in Zambia is set to produce 1.10 billion carats over a 25 year mine life, which is more than initially anticipated.

The company said the total amount of indicated and inferred mineral resource at the emerald mine, 75% owned by Gemfields, is now estimated at 1.8bn carats worth of the green gemstone and beryl.

According to SRK, the company needs to spend $84 million over the first four years of the project, and a total of $516million over Kagem mine’s life to create and operation that will initially process around 90,000 tonnes of ore per year. By 2018 output would ramp up to 180,000 tonnes per year, as it will add the Fibolele pit to the project.

Over its mine life, Kagem is now expected to produce 44.7 million carats per year on average.

Gemfiels said it would continue exploring the asset "over the next few years" to determine the further resource potential.

"As I have said on many occasions over the past few years, this operation has a bright future, is still maturing as an established producer, with much more yet to come," said Chief Executive Ian Harebottle.

Gemfields shares were up 3.3% to 61.97 pence per share on Wednesday morning, closing at 61 pence.