The Star Diamond Project is situated 60km east of Prince Albert, Saskatchewan, which is the main supply centre for Northern Saskatchewan, encircling the Star Kimberlite area. Star Kimberlite is located at a burned portion of the Fort a La Corne forest.
Star Kimberlite is among the largest diamond bearing kimberlites worldwide, covering 352ha. The Diamond Project and the Fort a La Corne joint venture (FALC-JV, a joint venture of 66% Shore and 34% Newmont, also referred to as ‘Star West’), are located within it.
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The Star Diamond Project is a mineral disposition in grounds owned by Canada’s Shore Gold and Fort a La Corne. The project is wholly owned by Shore Gold and is treated as a single entity. Shore Gold’s main business is the acquisition, exploration and development of mineral properties.
The project area covers 23 mineral dispositions aggregating to 9,280ha. Shore Gold controls 395 claims covering 219,196ha.
In February 2009, Shore Gold announced a mineral resource estimate for the explored portion of the Star Kimberlite area. The resource estimate includes the diamond results of eight additional large diameter drillholes; five holes on the Star area and three holes on Star West, aggregating 1,368m of drilling with 306m in kimberlite.
The updated resource estimate integrates additional diamonds recovered from concentrate and tailings audits along with geology’s influence on the diamonds distribution within Star.
The mine has probable reserves of 171 million tons at a weighted average grade of 12 carats per 100t. Indicated reserves are 20.5 million carats at 14 carats per 100t while inferred reserves have been estimated at 3.1 million carats at 12 carats per 100t.
Production
A pre-feasibility study completed by P&E Mining Consultants in August 2009 estimated that the mine would produce 20 million carats of diamonds over 12 years.
Budget
As a consequence of the deflated diamond and financial markets, the company has announced a reduced budget of $17.9m for 2009 acrross all of its projects. This includes $2.5m for Star Kimberlite, $1.0m for Star West and $9.5m for the Fort a la Corne Joint Venture.
The pre-production capital cost estimated for the Star Diamond mine is $1,487m. The total capital cost is budgeted at $1,646m with a payback period of 5.2 years.
Sampling
The company has announced its results for reconciliation of diamond grade results for the large diameter (LDD) mini bulk sampling with the underground (UG) bulk sampling. This process of LDD and UG sampling is required to thoroughly assess large, buried kimberlites of the Fort a la Corne area.
The UG sample gives appropriate diamond grade and size distribution data which is used as representative of the area sampled for reviewing the potential for future mining. The collection of UG bulks were prohibited due to economic and logistical parameters across the entire kimberlite.
The occurrence of diamond breakage and diamond loss while sampling using LDD has also led to use of combination of UG and LDD sampling. Therefore, the requirement for use of combination of UG sampling and LDD arises.
In June 2010, Shore Gold announced that 26% of the diamonds from the underground bulk sample graded above 2.7 carats belong to the type IIa category. These account for just 2% of natural rough diamonds.
Joint venture
A joint venture between Star-Orion South Diamond project involves the mining of an open pit at the Star Kimberlite and a potential second pit at the Orion South Kimberlite, and construction of a common processing plant and related infrastructure to extract diamonds from these kimberlites. The area to be covered is estimated to be between 3,000ha and 4,000ha.
Shore gold has submitted a project proposal for joint Star-Orion south Diamond project to Environment Assessment Branch of Saskatchewan Ministry of Environment along with various Federal agencies.
In February 2011, Shore Gold allotted $12.5m for the project, including $4.4m towards the FALC-JV. However, Newmont Mining refrained from participating in the budget.
The new budget will allow Shore Gold to complete the feasibility study on the Star-Orion South Diamond project by the second quarter of 2011.
