SOUTH AFRICA
Introduction
South Africa has a long legacy as a diamond producer extending back over a century to the early days of the founding of De Beers in Kimberley. However, in recent years the apparent complexity of doing business in the country has resulted in mineral exploration activity being limited. Prospecting rights have thus been allowed to lapse on the part of the majors which has paved the way for smaller operators and individuals to stake claims over what would be considered in other domains as highly prospective ground.
A review of fiscal regimes in Southern Africa has shown South Africa to be competitive from an investment point of view, mainly due to lower royalties payable to the state on revenues, and lower rates of citizen free carry. The country therefore represents an opportunity for diamond exploration and project development.
Acquisition
Following outside interest in acquiring Vutomi Mining Pty Ltd (‘Vutomi’) the South African associate company of BOD, the Company exercised its pre-emptive right to acquire the outstanding third-party interests in Vutomi and Razorbill Properties 12 Pty Ltd (“Razorbill”).
Vutomi holds the mineral rights to the Thorny River, Marsfontein and Reivilo diamond projects. The consideration for Vutomi comprised 56,989,330 new ordinary shares in the Company which, at the closing mid-market price on 28 September 2021 of 1.10p per share, is valued at £627k.
The Company agreed that immediately on completion of the acquisition, the Company would sell 26% of Vutomi for a deferred consideration of US$316,333 to the Company’s local South African Empowerment partner, Baroville Trade and Investments 02 Proprietary Limited in order to comply with South African requirements on empowerment ownership, which will be funded by a loan from BOD. On completion, the Company will own 76% of Vutomi.
All the necessary approvals were gained during the reporting period and the transaction closed. Since acquisition, Vutomi has changed its name to African Irish Diamonds Pty Ltd.
Thorny River (including Marsfontein)
Extensive exploration work has been undertaken on Thorny River which culminated in both a Competent Persons Report (‘CPR’) and Technical Economic Evaluation (‘TEE’). The former delineated the following exploration parameters for the kimberlite dyke and blow system in the Limpopo Province of South Africa:
- Grade: 46 – 74 cpht (+1mm BCOS);
- Diamond value: USD120 – 220/ct (+1mm BCOS) and
- Volume: 1.2 – 2.1 M tons.

Figure 10: The Thorny River project area
The company has been active at Marsfontein and Thorny River through the conduct of detailed ground geophysics, drilling and bulk sampling over several years. The kimberlite has been found to be consistent with that found at Klipspringer Mine in the west and Frischgewaagt in the east and this consistency applies not just to the geology but to grade and diamond value.
Following extensive geological work, a mine plan evaluation was completed by South African-based independent mining advisory consultants, Practara (Pty) Ltd, together with modelling input from ABGM Pty Limited of Australia. Conceptual open pit mine plan models were developed under a number of scenarios to assess the open pit mining potential of the River and River Extension blows (collectively ‘the River’). The models used the results of several drilling programmes and detailed ground geophysics. Grade and diamond value data was based on previous microdiamond and bulk sampling data as well as production results from the adjacent Klipspringer mine and the TEE. Cost data was benchmarked against similar operations.
The evaluation is based on pre-tax illustrative estimates of cashflow before provision of capital expenditure or pre-production costs and which have not yet been determined. The objective of the evaluation was to identify the best open pit mining option and considered low, medium, and high-cost scenarios for mining.

Figure 11: Conceptual mine plan models for Thorny River
The following table illustrates results of the medium-cost scenario in the evaluation at a mid-range diamond value of $170/ct and a discount rate of 10%. Grade and diamond values are stated at a bottom cut-off of +1mm.

The TEE stated that the kimberlite exploration target at Thorny River area has a grade of between 46 and 74 cpht and diamond value of between $120-220/ct at a bottom cut off of +1mm. For the purposes of the evaluation, a lower grade of 20 cpht was also considered. The River medium-cost scenario mining model shows positive operational cash flow net present values for potential future open pit exploitation options at a conceptual level. Any open pit that is formed on the basis of a low revenue assumption (i.e. at revenue factors less than 80%) coupled with the maximum open pit size are indicated to be commercial.
Following positive results from the evaluation, permitting for mining and water use have been were applied for over the area of interest. Permitting has reached an Accepted’ stage which and this has triggered environmental and community consultations in advance of issuing approval, which is expected during the course of Q2 2023.
Reivilo (Farm 21 or 18OP) kimberlite pipe cluster
The company has been granted a five-year prospecting licence on ground containing the Reivilo cluster of kimberlites (‘Reivilo’) in the Barkley West area of South Africa. Reivilo is located approximately 110 kilometres north-east of the actively producing Finsch diamond mine.

Figure 12: Aerial view of the 18OP kimberlite pipe from Prospecting in Africa by De Wit et al
Exploration by Petra, who were the previous operators, reported to have delineated a cluster of three kimberlite pipes, with sizes of 3.1 hectares, 1.7 hectares and 0.9 hectares all within a 250-metre radius. Samples of the drilling core produced G10 and eclogitic garnets which are the optimal indicators for diamondiferous kimberlites.
Following Granting of the license, the Company entered into a data licence agreement with Petra, the previous holder of the Reivilo licence, to have access to their full library of data on Reivilo. The data licence agreement grants Petra a 3% royalty on any production revenue generated from the Reivilo prospecting licence in return for access to all of the Petra’s data accumulated during their work on the licence.

Figure 13: Reivilo kimberlite cluster (Petra data)
The company will review this data prior to finalising its own exploration programme.
Updated 1st September 2023