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  1. stolwyk

    22,691 Posts.

    BHPB to decide on Tawana joint venture next month

    Michael Quinn

    Thursday, March 25, 2004
    BHP Billiton will decide by the end of April whether it will remain in the Daniel alluvial diamond project in South Africa with 40% partner Tawana Resources following completion of a drilling and 518 tonne bulk sampling program that recovered 13 diamonds weighing a total of just under one carat.

    The reconnaissance sampling program recovered diamonds from all over the 13km long by 2km wide Daniel paleochannel that is interpreted to have drained from the adjacent Finsch diamond operation that De Beers has been mining since the 1960s.

    While Tawana managing director Wolf Marx conceded that investors may be disappointed by the small size of the diamonds recovered, he believes that wide diameter drilling using a Bauer rig will bring up larger stones should it be used in the next phase of exploration.

    Marx's plans for the next phase of exploration involve the collection of not less than 40,000t of gravels using Bauer rig, a program that will begin in May-June, take a couple of months to complete, and cost around $1 million. Tawana currently has around $4.5 million cash.

    However, Marx said that if BHPB remains in the project it may decide to manage the joint venture.

    Should BHPB walk, it will retain a royalty whilst Tawana will have 100% of the project. The two companies are also in a 70:30 joint venture on a number of hard rock-kimberlite project in the Kimberley region.

    Shares in Tawana were off 16 cents at $1.36 in early afternoon trade. A sell-off following the release of today's result saw shares fall as low as $1.05.

    Click here to read the rest of todays news stories.

    Drilling at Tawana's Daniel prospect in South Africa has traced the ancient river system to within 500m of De Beers' Finsch mine

    Bauer's Drill: Diam=2 m. In use by KIM

    However, the question remains of proving larger stones unless these (because of mass) have been pushed downstream to the alluvial coast where 14 cpht is found. (No, I am not an expert, just an opinion).

    I am not so sure if BHP will carry on because of the very small ct size. See what happens.


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