DAILY NEWS Nov 15, 2012 3:57 PM - 0 comments

DIAMOND DEVELOPMENT: Stornoway, Quebec sign new road deal

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2012-11-15

QUEBEC – Les Diamants Stornoway (Canada), a wholly owned subsidiary of Montreal-based  Stornoway Diamond Corp., has signed a new agreement with the government of Quebec for the financing and completion of the 240-km-long Route 167 extension under Stornoway's direct management. The deal is designed to ensure that the road to the Renard diamond project in the north-central part of the province is ready so that construction can begin by the end of 2013.

Stornoway has agreed to assume responsibility for the completion of segments C and D as a single-lane mining grade road. The province will provide the company with an unsecured credit facility of up to $77 million to fund the work. This season's winter road to the site will be built by the province.

In November 2011, Stornoway released the results of a feasibility study for Renard that highlighted the potential of the project to become a significant producer of high value rough diamonds over a long mine life. The probable mineral reserves stand at 18.0 million carats, with a further 17.5 million carats classified as inferred, and 23.5 to 48.5 million carats classified as non-resource exploration upside. All kimberlites remain open at depth. Pre-production capital cost stands at an estimated $802 million, with a life of mine operating cost of $54.71/tonne giving a 68% operating margin over an initial 11-year mine life.

Highlights of the feasibility study are posted at StornowayDiamonds.com.

Companies in This Story

Stornoway Diamond Corporation

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