West Africa-focused Stellar Diamonds (LON:STEL) posted Monday a deeper first-half loss due to an increase in costs of developing its Tongo-Tonguma project in eastern Sierra Leone.
Delivering interim results for the six months to Dec. 31, chief executive Karl Smithson said market conditions for junior miners attempting to raise funds remained "extremely difficult."
The executive noted the company, which didn't record any revenue for the period, had a market capitalization for the period that around the $2 million-level, which provided additional challenges for attracting funds to develop the Sierra Leone mine.
Smithson also said that Australia-listed Newfield Resources' (ASX:NWF) share-based takeover bid, which came earlier this month, was pitched at a premium price. He added the imminent buyer also provided a $3 million-loan to keep Tongo-Tonguma moving forward while the deal is progressed to completion.
The funds, said Stellar, will also be used to pay legal and corporate financial advisor costs, including those related to the possible offer for the company.
The combined resource of Tongo-Tonguma is established at 4.5-million carats, of which 4-million carats is estimated to be recovered during the initial 21-year life-of-mine.
The net loss posted by Stellar was $984,928, compared to $663,145 it lost a year earlier.