Coloured gemstones miner Gemfields has produced the first measured mineral resource and proven ore reserve statement for its 75%-owned Kagem emerald mine, in Zambia.
The company on Wednesday said a Competent Persons Report (CPR), produced by consulting firm SRK Consulting, had shown a Joint Ore Reserves Committee-compliant measured, indicated and inferred mineral resource of 1.8-billion carats of emerald and beryl at an in-situ grade of 281 ct/t at Kagem.
The report also showed proven and probable ore reserves of 1.1-billion carats of emerald and beryl at a diluted ore grade of 291 ct/t.
“As the first recorded measured mineral resource and proven ore reserve statement for Kagem, and possibly the first of its kind across the entire global coloured gemstone sector, the significance of this report is not only a milestone event that bears testament to the quantity and quality of work carried out by SRK and the Gemfields team at Kagem, but also provides further evidence to the continued growth potential, positive momentum and considerable opportunity inherent within the openpit mine plan,” said Gemfields CEO Ian Harebottle.
The Kagem life-of-mine (LoM) plan would see production expand from the current 90 000 t/y to 180 000 t/y by July 2018 through the inclusion of the Fibolele pit.
The 25-year LoM was expected to deliver 1.1-billion carats, with average yearly output of 44.7-million carats of emerald and beryl.
The projected real cash flow – with no discount rate applied – over the LoM was about $1.59-billion.
The project had an expected net present value of $520-million, with capital expenditure of $516-million required to deliver the project.
Investec commented that the publication of the maiden resource for Kagem was a positive development for Gemfields, as it demonstrated considerable upside potential at the mine.
“This will further expand the company’s dominance as the single-biggest emerald miner globally,” it added.Gemfields delivers maiden mineral resource, ore reserve estimates for Kagem