Paragon Diamonds’ (LSE: PRG) management is looking to begin producing large, high-value diamonds in order to build a top-class diamond company.
The production is set to commence in early 2015 at the Lemphane Kimberlite operation in Lesotho.
Paragon Diamonds plans to manage the journey of the stones from the ground to the high street, in order to ensure that its shareholders preserve maximum value.
Stage 1 is set to commence in 2015 and will be in operation for two years.
Initial revenue at the Lemphane Kimberlite Mine is expected to be around US$9 million per annum where production of 20,000 carats, with an estimated average value of $930-1,025 per carat, has been targeted.
The company has secured a renewable 10-year mining lease at Lemphane.
Paragon Diamonds CEO Stephen Grimmer said: “Having secured a mining lease during the period and with infrastructure already in place at the site, our immediate focus is to secure a processing plant so that we can commence Stage 1 production at our flagship Lemphane pipe in Lesotho in the near term.”
Stage 1 is expected to mine 1 million tonnes of ore and result in the recovery of more than 100 diamonds larger than nine carats.
“The report indicates the recovery of diamonds of over 300 carats in size, up to 50 diamonds in excess of 100 carats and 175 diamonds in excess of 50 carats,” said Grimmer.
“These numbers are consistent with those being achieved at the nearby deposit of Letseng, and if achieved would see Lemphane added to the list of world class kimberlite pipes in Lesotho.”