Stellar Diamonds to operate Tonguma mine in Sierra Leone

Process plant at the Tongo project, in Sierra Leone.(Image courtesy of Stellar Diamonds)

Shares in West Africa-focused Stellar Diamonds (LON:STEL) closed slightly up on Thursday after the company revealed it had inked an agreement to operate the Tonguma mine in Sierra Leone, adjacent to the company’s own Tongo mine.

Stellar originally intended to combine its Tongo project with Tonguma, which would have created Sierra Leone’s second largest diamond mine.

The company, which applied for large-scale mining in the African nation in 2015, originally intended to combine its Tongo project with Tonguma, owned by junior Octea Mining.

The deal would have created Sierra Leone’s second largest diamond mine, with a combined annual production of 250,000 carats.

However, Stellar opted out of the proposed acquisition and, instead, has agreed to run the mine and sell the extracted diamonds, paying a 10% of the revenue after deduction of government royalties to Octea.

The new deal, which is pending legal and government approval, was unveiled as the company announced it had raised £324,500 through the issue of 5.9-million new ordinary shares, at 5.5p each.

The company also expects to raise £250,000 at 5.5p each through an open offer.

Proceeds of the placing and the open offer, as well as a $175,000 management fee, will be use to advance the deal with Octea Mining, the company said.

Shares in the company closed up 1.33% to 7.22p.

187 0
Latest Stories

MSHA honours Massey operations for safety achievements

The Mine Safety and Health Administration (MSHA) in the USA has selected the Green Valley Preparation Plant and two mines operated by the Aracoma Coal Co to receive Pacesetter Awards for outstanding safety achievements. Green Valley and Aracoma are operating units of Massey Energy Co. The awards to the Green Valley plant and Aracoma’s Alma and Hernshaw mines honour operations [...]

Eyes on Indian Underground

increasing demand for coal. Industry observers believe that India is poised to become a major market for mining equipment, even larger than China, and this opportunity has led several global mining companies to open up shop in the country at least four

SIGN UP FOR OUR DAILY NEWSLETTER

Bateman makes major acquisitions in mineral processing

As IM May is prepared for printing, with an article on developments in mineral processing, comes dramatic news from Bateman. The company has recently acquired the mining-process division of Intertech, with a strong market presence in the CIS. Even more significant, Bateman’s latest acquisition, announced as IM goes to press, is that of the Delkor [...]