Kimberley Diamonds (ASX:KDL) has been awarded a package of tenements covering the gold-rich Lomero-Poyatos massive sulphide deposit, located within the Iberian Pyrite Belt, Spain’s premier mining district.
The most recent estimate of the deposit was prepared in 2012 by the independent global mining consultancy Behre Dolbear International.
That study estimated the deposit as 830,000 ounces of gold in an Inferred Resource of 6.07 Mt at 4.25 g/t gold and 88.74 g/t silver.
At the time of acquiring the Ellendale diamond mine in February 2013, KDL had a number of copper-gold exploration tenements in its exploration portfolio.
KDL has actively sought a flagship copper-gold project to complement these assets with the view to spinning out the combined portfolio of non-diamond assets into a new entity.
Existing KDL shareholders would be given shares in the new entity through an in specie distribution, with the new entity to be listed within the next 12 months.
KDL is not required to pay any consideration for these tenements upfront. To maintain these tenements, KDL is required by the Andalusian government to spend €400,000 on exploration expenditure in Year 1 and a further €5 million spread over Years 2 and 3.
As KDL is not required to pay any upfront consideration for this acquisition, it has no current impact on KDL’s existing activities, other than the required exploration expenditure.
With highly prospective geology, pro-mining government policies and markedly lower costs of production relative to those in Australia, Spain is an ideal exploration environment.
All the significant mining projects in Spain have been acquired by major international companies within the last five years.
Prior to its closure in 1991, the Lomero-Poyatos mine produced at least 2.6 million tonnes of massive sulphide ore containing 5 g/t gold and 1.2% copper.
The gold grade the highest of all the deposits within the Iberian Pyrite Belt.
