Stellar Diamonds has secured an environmental licence for its Tongo kimberlite development project from the Environmental Protection Agency (EPA) of the Government of Sierra Leone.
The company expects that the National Minerals Agency will draw up the Tongo mining licence for consideration and signature by the country’s minister of mines and mineral resources.
The project is part of the Tongo-Tonguma mine development, which is estimated to produce more than four million carats and generate gross revenues in excess of $1.2bn over a mine-life of 21 years.
Stellar Diamonds chief executive Karl Smithson said: “The receipt of the environmental licence marks an important milestone in the proposed development of the Tongo deposit into commercial production.
“The next milestone will be the drafting of the Tongo mining licence.
“Tongo forms part of the proposed 4.5 million carat combined Tongo-Tonguma mine development, which has the potential to be the second largest hard rock diamond mine in West Africa and have one of the highest $/t kimberlite ore values globally.”
The company expects initial production at the Tongo-Tonguma mine to occur in the first year of development.
Production is projected to build up to more than 200,000 carats per annum.
The mine is estimated to give the company post-tax net present value at 8% discount rate (NPV) of $109m and internal rate of return (IRR) of 30%.