Friday, July 27, 2012

Firestone Diamonds reports on progress at Liqhobong mine; appoints new CFO

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Firestone Diamonds (LON:FDI) said it treated 152,422 tons of ore in the second quarter at the pilot plant of the Liqhobong mine in Lesotho - nine per cent above its forecasts.

49,240 carats were recovered at a grade of 32.3 carats per hundred tonnes (cpht), it said, in a trading update, which also revealed sales figures for stones from the mine at a dual tender held in Gaborone and Antwerp this month.

The company also revealed it had appointed a new chief financial officer - Grant Ferriman. Modifications at Liqhobong's pilot plant aimed at decreasing breakage began in June and were completed this month and are expected to lead to a further improvement in diamond values.

Chief executive Tim Wilkes told investors: "We have continued to build on the positive production and carat recovery trends from Q1. "The second planned shutdown during the latter half of June has gone very smoothly and the plant is ramping up towards a steady state of around 2000 tonnes per day."

At the tender, 45,773 carats were sold, realising gross revenues of $4.14 million or $91 dollars per carat, the firm revealed. This price was significantly higher than the $71 per carat achieved during the previous quarter.

The dollar per carat achieved demonstrates continued strong demand for higher quality stones whilst some pressure remains on the poorer quality and smaller stones, Firestone said.

Wilkes said the encouraging sales bode well for the feasibility study on the main treatment plant at Liqhobong, which will undergo final review for board approval in October 2012.

The DFS for the main treatment plant is largely completed and being reviewed, the firm said. The results are expected to be announced towards October this year.

Firestone also announced it had appointed Julian Treger and Mike Wittet as non-executive board members with effect from Tuesday (July 24). In addition, Grant Ferriman joined the firm as CFO with effect from July 5 this year.

The firm said it had a strong cash position of around $16.3 million as at June 30 this year and was reviewing its strategy in regard to its exploration portfolio and would update the market in due course.

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