Further work at BK16 deposit 'justified' - consultant

TSX-V-listed Tsodilo Resources on Wednesday announced the completion of a second independent size frequency distribution (SFD) modelled grade and diamond value for the 77.94 ct parcel of 502 commercial size diamonds recovered during BK16’s large diameter drilling (LDD) programme.

In December, it was discovered that the size frequency model used in an initial SFD modelling exercise had resulted in an “overly optimistic project” of grade values, the company said in a statement.

Given the significance of the error, Tsodilo retained the services of Interlaced consultant Stephen Coward to review and develop a new model grade and valuation figures, based on the same raw BK16 data.

The approach included in-depth SFD modelling and simulation and provided direct comparisons with comparable projects.

Tsodilo has accepted the results of Coward’s findings as definitive for the grade and value modelling of the BK16 deposit.

The company believes the combination of grade, diamond value and kimberlite value defined by Coward suggests that BK16 has “significant potential to become a mineable asset”.

To improve the confidence on both the grade and value a further phase of bulk sampling of BK16 would be required.

According to Coward, based on his analysis of the SFD of the diamonds recovered from the LDD samples, it appears that the size distribution of BK16 could be coarser than assets owned by several other producers in Southern Africa.

“There are indications that BK16 could have a broadly similarly coarse shaped size distribution to that of Lucara’s Karowe mine, in Botswana, Petra Diamonds’ Premier mine, in South Africa, and Lucapa Diamond’s Mothae mine, in Lesotho.”

However, Coward warned that there is a clear undersampling of coarse stones so far at BK16, which he said added significant uncertainty to the grade and value modelled.

This uncertainty is the result of the current 2 077 dry metric tonne LDD sample representing a distinct undersampling of the true SFD of the BK16 kimberlite, he explained.

“This undersampling explains why the sample grade and diamond value are well below the modelled grade and value, and thus why the value and grade modeling reported by this study are so important and should be considered a more accurate reflection of a likely BK16 run of mine production.”

To this end, Coward remained of the opinion that further work on BK16 is justified, including the execution of an optimised bulk sample campaign to confirm its potential.