Brazilian Diamonds Limited

Brazilian Diamonds Limited

February 26, 2008 03:01 ET

Brazilian Diamonds Limited: Salvador I Bulk Testing-Preliminary Results Pit 1

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 26, 2008) - Brazilian Diamonds Ltd (TSX:BDY)(AIM:BDY) ("Brazilian Diamonds" or the "Company") provides the following update on the ongoing macro-diamond testing of its 100% owned Salvador 1 kimberlite in central Bahia State, Brazil. The Company is pleased to confirm the recovery of diamonds from the partial processing of initially excavated kimberlite material and the separately processed diamond bearing sands and gravels that overlay the Salvador 1 kimberlite.

The initial and partial results reported in this announcement are considered encouraging for the remainder of the testing of the Salvador 1 kimberlite and the Company looks forward to reporting complete results from each of its test pits as they become available.

Salvador 1 Kimberlite Testing

The Salvador 1 kimberlite is a six hectare body partly exposed beneath the sands and gravels of an old alluvial diamond mine in central Bahia State, Brazil. The ongoing testing of the Salvador 1 kimberlite has completed excavation from the first two of the scheduled six pits. Each pit is designed to extract approximately 1,300 tonnes of kimberlite from different parts of the kimberlite pipe.

Extraction from Pit 1 began in November 2007, and excavation is currently proceeding on the third pit. The kimberlite is multiphase, with as many as six kimberlite rock types identified in the first pit alone. A single one of these phases dominates most of the excavated sample from Pit 1. Partial results are reported herein, with complete and fully verified results to be reported upon completion of all stages of processing.

Processing of the first kimberlite sample began in December 2007 and has been accelerated in the first part of 2008 as on-site plant procedures for the treatment of recovered kimberlite have been improved. This processing plant consists of a primary disaggregation rotary pan, followed by x-ray flowsort and grease table for the recovery of diamonds. It has been augmented with a roll crusher to better handle harder kimberlite fragments, however sample treatment remains slower than excavation.

While none of the samples extracted to date have been fully processed, the Company is pleased to report the recovery of 66 diamonds weighing 7.78 carats, with the largest stone weighing 2.65 carats from the Pit 1 kimberlite material processed to date. These diamonds come from four separate samples taken from within Pit 1 and represent a total of 1,460 tonnes of extracted kimberlite ("in-situ") (calculated using an experimentally determined average kimberlite density of 2.23 g/cm3).

Approximately 52 per cent. of the total kimberlite extracted to date has begun to be processed and significant parts of that remain incompletely processed (for example, needing further recrushing of harder kimberlite materials to liberate fine diamonds).

Processing of the kimberlite sub-sample from the top one metre portion of Pit 1 is almost complete with 35 diamonds weighing 2.51 carats recovered from 128 tonnes of in-situ kimberlite processed. More than half of this sample remains to be reprocessed through the plant after crushing to liberate diamonds enclosed in kimberlite fragments recovered during the first processing pass. These stones were tested at the Company's ISO 17025 certificated laboratory in Patos de Minas, with 9 remaining on a +2.0mm screen, and 20 remaining on a 1.0 mm screen, and 6 remaining on a +0.6 mm screen (Table 1).

Table 1: Partial results from the top sub-sample in Pit 1.

Partial Results Kimberlite Pit 1 - top 1m sub-sample Start Weight
Screen Opening # stones
+4.0 mm -
-4.0 / +2.0 mm 9 1.58cts
2.0 / +1.0 mm 20 0.83cts 128 tonnes(i)
-1.0 / +0.6 mm 6 0.10cts

Total 35 2.51 cts

(i)partial results

The second sub-sample of Pit 1 weighing a total of 123 tonnes from a depth of one to two metres into the kimberlite has yielded 20 diamonds weighing 4.45 carats, but with part of the sample still awaiting first pass and second pass processing, as well as quality control tests at the Patos Laboratory. Of the recovery from kimberlite to date, 1 stone weighing 2.65 carats remained on a 6.0 mm screen, 1 remained on a 4.0 mm screen, 3 remained on a +2.0mm screen, 11 remained on a 1.0 mm screen, and the other 4 remained on a +0.6 mm screen.

Table 2: Partial results from the second sub-sample (one to two metre
depth) from Pit 1.

Partial Results Kimberlite Pit 1 - second sub-sample
1-2m depth Start Weight
Screen Opening # stones
+6.0 mm 1 2.65 cts
-6.0 + 4.0 mm 1 0.90 cts
-4.0 / +2.0 mm 3 0.40 cts 123 tonnes(i)
2.0 / +1.00 mm 11 0.45 cts
-1.0 / +0.6 mm 4 0.05 cts

Total 20 4.45cts

(i)partial results

The third kimberlite sub-sample of Pit 1 is less than half way through processing and so far has yielded 11 stones weighing 0.82 carats, demonstrating that the Salvador 1 kimberlite carries diamonds to the maximum tested depth of 11m below the kimberlite surface.

Complete size and weight distributions will be reported upon completion of this and the other sub-samples for Pit 1.

Quality control and quality assurance is being undertaken at the company's certified ISO 17025 indicator mineral processing laboratory on Patos de Minas, Brazil, where concentrates are re-examined for diamonds that may not have been recovered in processing by the on-site plant.

Salvador 1 Alluvial Sand and Gravel Testing

Concurrent with the kimberlite sampling and processing at Salvador 1, an entirely separate processing plant is being used to recover diamonds from the sands and gravels overlying the Salvador 1 kimberlite.

The diamond-bearing sands and gravels overlying the Salvador 1 kimberlite have a long history of being mined for diamonds by artisanal miners (garimpeiros) but need to be removed for any future mining activity from the underlying kimberlite. The Company is therefore testing these sands and gravels for their diamond production potential at the same time as excavating pits into the underlying kimberlite body.

The on site reporting of the preliminary results from the separate sand and gravel processing plant include recovery of 124 diamonds weighing 17.86 carats from 1,420 m3 bulk volume of gravel and sand material (estimated to weigh 1,720 tonnes using an estimated 2 g/cm3 density in-situ) transported to the gravel plant. However approximately two thirds of this material has yet to be processed through the recovery plant (flowsort and grease tables).

The material initially processed includes sands and gravels from above Pit 1 and the kimberlite-alluvial surface and the four largest diamonds so far recovered weigh between 0.91 and 1.06 carats. Four of the recovered diamonds remain on a 4.0 mm screen, 51 remain on a +2.0 mm screen, 52 remain on a 1.0 mm screen, and the other 17 remain on a +0.6 mm screen.

Table 3: Partial results from the gravels and sands overlying the Salvador
1 kimberlite. Note that less than one third of the total start weight has
so far been fully processed.

Gravel and Sands Start Weight
Screen Opening # stones
+4.0 mm 4 3.57 cts
-4.0 / +2.0 mm 51 11.51 cts
2.0 / +1.0 mm 52 2.40 cts 1,720 tonnes(i)
-1.0 / +0.6 mm 17 0.38 cts

Total 124 17.86 cts

(i)partial results

Dr. Harrison Cookenboo (P.Geo), a Consulting Geologist and Qualified Person as defined under National Instrument 43-101, is responsible for the technical disclosure in this release and has reviewed and approved the contents of this release. Dr. Cookenboo assisted in the design of the Salvador 1 testing programme and completed a site field visit in December 2007. The site visit included the examination of the kimberlite exposed in Pit 1 as referred to in this announcement and verification of the operations up to that time.

Commenting on these results, Kenneth P. Judge, Chairman of Brazilian Diamonds said: "We are pleased to be able to report the recovery of diamonds from the partial processing of samples taken from the overlying sands and gravels as well as in all sub-samples of the Pit 1 kimberlite down to the maximum excavated depth of 11m beneath the kimberlite surface. We are especially encouraged by the recovery of larger stones and with the introduction of new plant procedures and equipment, we should be able to significantly increase the rate and efficiency of processing. We therefore look forward to reporting complete results from each of the proposed test pits as they become available."

Dr Cookenboo commented that, "I am encouraged that we have recovered diamonds from each of the Pit 1 sub-samples. Given the multiple different kimberlite rock types ("phases") which I have seen in Pit 1 exposures as well as in the diamond drill core, I look forward to seeing the results of the ongoing pit tests, the receipt of which should be accelerated by the introduction of new plant procedures and equipment."

Editors' Note

Brazilian Diamonds is a leading Brazil-based exploration company focused on the discovery of kimberlites on its extensive portfolio of properties in the States of Minas Gerais and Bahia, with the goal of becoming a significant producer of diamonds.

The Company is awaiting final approval before commencing the environmental licensing process for the development of the Canastra 1 kimberlite body for which mine feasibility work has already been completed and the required Mines Department approvals are already in place. It is intended to bring Canastra 1 into production once the environmental licensing process is completed.

The Company's Salvador diamond project in Bahia includes the diamondiferous Salvador 1 kimberlite. This project was acquired from De Beers which retains a right to reacquire up to 40 per cent. of any kimberlite found on the Salvador properties which is confirmed to contain more that 200 carats of diamonds.

The Company has a fully operational diamond separation/analysis laboratory at Patos de Minas, Minas Gerais which is strategically located near its properties in the Santo Ant"nio and Coromandel areas. The Company has a highly experienced team including six geologists located at the Company's facilities in Brazil.

The Company's strategy for non-core activities on its properties is to form joint ventures. A Cdn$1,000,000 feasibility study is underway for a joint venture for the mining of alluvial diamonds on its properties in the Santo Ant"nio river drainage. The joint venture involves two important Brazilian companies: CODEMIG, the state owned mining development organization and Mineracao Rio Novo Ltda., a wholly owned subsidiary of Andrade Gutierrez SA, one of Brazil's largest civil engineering firms and an existing large scale, dredge based producer of alluvial diamonds.

Contact Information

  • Brazilian Diamonds Limited
    Ken Judge
    + 44 7733 001 002
    Brazilian Diamonds Limited
    Stephen Fabian
    + 55 31 9186 4660
    Brazilian Diamonds Limited
    Investor Relations
    + 44 207 590 5503
    Brazilian Diamonds Limited
    Investor Relations
    North America
    Hanson Westhouse Limited
    (Nomad to the Company)
    Tim Feather
    + 44 113 246 2610
    Hanson Westhouse Limited
    (Nomad to the Company)
    Matthew Johnson
    + 44 113 246 2610
    Landsbanki Securities (UK) Limited
    (Broker to the Company)
    Tom Hulme
    + 44 207 426 9000