I called because I just wanted to get a sense of the possible tempo of potential news flow...I'm impatient.
What I was able to determine (and apologies if all of this is well-known already) is as follows:
The systematic drilling of the 61 Kimberlite targets is underway. The first few of the 61 holes have been drilled, and there is a backlog of material from these drills requiring DMS processing. The DMS equipment is partially operational, but not fully online and up to speed at full capacity. Therefore it cannot hope to immediately keep up with and process the amount of sample material being drilled and collected. However, as more of the DMS capability comes online over coming weeks, the ability to process drilled material will accelerate, with DMS capacity reaching full horsepower by March 2013.
In parallel with the above, the search for more "alluvial" diamonds is ongoing. For those who may not know what alluvial means, it refers to diamond material which has been washed away from the Kimberlite source(the source being that which the 61 hole drilling program is looking for). The recently discovered 131.5 carat diamond was one of these alluvials. More alluvials could potentially be found whilst the 61 hole program progresses.
Miles stated that regarding the potential newsflow, we are now entering the beginning of the phase whereby any one of the 61 targets could hit a Kimberlite pipe; he also pointed out that "we only need to hit one". Significant material from the first few holes already drilled is awaiting processing by the minimal DMS capability presently operational, therefore it is "not impossible that we have already hit Kimberlite with the initial holes completed to date and we don't know about it yet...the DMS needs to catch up with the drilling".
Finally, I raised some of my own thoughts about the fact that diamond exploration is inherently different to the exploration for other materials, in that at any moment the discovery of free alluvials immediately represents significant cash value and capital to the company such that the requirement for ongoing capital raisings could potentially be mitigated significantly. Miles agreed entirely with this. And in conclusion he offered the closing remark that he personally and the rest of the company were extremely enthusiastic about the likelyhood of an imminent discovery, and that the significance of hitting a single Kimberlite source pipe was immense and could not be overstated...
LOM Price at posting:
1.0¢ Sentiment: None Disclosure: Held
