Junior miner Botswana Diamonds (BD) has acquired Alrosa's 50% share in the Sunland Minerals project for a "nominal sum". BD's 100% ownership of Sunland now enables a new investor to enter as a new joint venture partner, and they say that negotiations with this potential partner are at an advanced stage.
The potential partner is said to be a large diamond producer with new ideas and keen to find new kimberlites in Botswana. BD anticipates the new partner taking over Alrosa's exploration activities and, once the deal is finalised, work could begin in the first half of 2019 focusing on drillisng targets identified in 2018. The potential new partner is said to have a strong exploration team in place.
According to a statement, changes to the board/top management level at Alrosa in 2016 and 2017 caused a change in emphasis. Early stage exploration joint ventures lost priority as corporate strategy shifted towards production and marketing.
Accordingly, operatorship of the Sunland JV transferred to BD in early 2018, after which Alrosa no longer contributed additional funds to exploration. Given the exploration potential already identified in the Gope region of the Kalahari, BD conducted focused work to protect the licences, and Alrosa has assisted the Company in the search for new partners.
The Sunland JV was established in 2014 to test existing Alrosa exploration technology on BD's large database. The logic was that new technology and exploration approaches could identify new targets - ideally large diamond-bearing kimberlites under the Kalahari sands - but grassroots exploration is a slow process requiring painstaking evaluation, refinement and selection of targets.
"Alrosa has been an excellent partner over the past four years," says John Teeling, Chairman of BD. "They brought a fresh approach and new technology to exploration in the Kalahari. The work done by Sunland was and is of a high standard. We had no instant success, you rarely do in exploration, but progress had been made toward the target of a commercial discovery.
For reasons unconnected with this acreage, new Alrosa management prioritised marketing over early stage exploration. This happened before, in a previous company, with the Karowe discovery. We successfully replaced a partner, which then developed the Karowe mine. I believe energy is more important than scale in driving innovative exploration."
He adds, "Although no guarantees can be given at this stage, we are at an advanced stage of discussions with a significant diamond producer who has in place an experienced exploration team."
Source: The Diamond Loupe