7 July 2018

Lesotho: Diamond Prospectors Shut Down Operations

HOPES for the establishment of a diamond mine in Quthing have been shuttered after the prospecting company discovered that the deposits in the area are do not warrant for viable commercial mining.

Mohokare Mining Company obtained a two-year license in 2015 to prospect along the banks of the Senqu River. Last September the company secured a one-year extension that expires next month.

The says it has decided to stop its operations on the expiration of the license.

In a letter seen by the Lesotho Times, the company informed the District Administrator of Quthing about its decision to discontinue operations although it did not disclose the reasons.

"The Mohokare Mining Company (PTY) Ltd, doing diamond prospecting project at Sebapala, Ha Ralenku, intends to close down the operation by the end of August 2018," part of the letter reads.

"May you please keep all the stakeholders informed about this decision."

Speaking to Lesotho Times, one of the company's directors Mosoeunyane Sehapi, said they would not continue investing resources into a seemingly commercially unviable project.

"In the three years that we have been prospecting at Sebapala, the results have not been promising. We have not found anything that warrants us to continue pumping in resources into the project," Mr Sehapi said.

He further indicated that the company had budgeted over M3 million for the explorations and had virtually used up all that money on setting up the prospecting plant and the employment of 18 people to work on the site. He said they are now rounding off operations in the remainder of their prospecting time.

"We are currently rehabilitating the area to try and bring it back to its original state and then we leave."

He said they were already plotting their next move which involves securing an alternative place to prospect in the Mokhotlong district; home to the world's best dollar-per-carat Letšeng Diamond Mine.

Alluvial mining involves the collection of minerals that have been deposited on river banks and beds as a result of natural action over thousands of years. This method of mining requires the sifting of mud, sand and gravel and does not involve extensive excavation.

However, this type of mining requires processing a lot of alluvial deposit in order to recover the minerals than in open pit mining since the concentration has been diluted by river deposits. However, alluvial diamonds tend to fetch higher quality diamonds

If the prospecting had been successful, the Sebapala Diamond Mine would be the first ever alluvial diamond mine in the country where open pit mining is the most common.

According to Geoidal Management & Experts, prospecting projects closure may principally be due to small capital, secondarily due to geological researches prior project commencement. Other causes relate to project planning and management. However, prospecting phase is intended to see whether the mining phase would be viable or not.

"The mining sector is at a juvenile stage in Lesotho and hence it is experiencing failures in it maturing process. We tend to over anticipate the rewards of our diamond prospecting projects and base our investment upon under researched projections with the hope to achieve entrepreneurial ambitions, creating employment and building an elite mining project. Alluvial Mining prospecting requires high amount of material to be processed to attain similar recoveries to kimberlite mining.

"In Lesotho, there are no clear regulations governing the authors of geological reports (during application) therefore authors are not accountable to their researches thereby leaving a gap that would ultimately result in abandonment of projects. Maybe the question should also be, who are the authors of these geological reports?" GM&E said.

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