Paragon Diamonds interest in Lemphane increased to 100%

Paragon Diamonds (LON:PRG) said Monday it conditionally increased its interest in the Lemphane Kimberlite project in Lesotho, owned by Meso Diamonds, from 85% to 100%.

The company, which already has projects in Lesotho, Botswana and Zambia, said it is moving toward the stage one mining development phase at the Lemphane Kimberlite project.

Stage one of a two-stage production program at Lemphane targets the mining of 500,000 tonnes per annum to recover an anticipated circa 10,000 carats per year.

The acquisition is conditional on admission of the new ordinary shares to AIM, expected to become effective on or around May 19, 2014.

Paragon will now hold 80% of the equity in the project, together with the Government of Lesotho holding 20%.

The company first undertook scoping study to design an operational model for the development of Lemphane in January.

There have been significant diamond discoveries in Lesotho in the past, a landlocked country completely surrounded by South Africa, including a rare 12.47-carat blue diamond recovered by Gem Diamonds’ (LON:GEMD) last year.

Paragon Diamonds was down 2.10% to $3.50 by midday on Monday.