Newfield Resources’ Tongo diamond project in Sierra Leone produced 7 800 carats in 2022 and this figure will virtually double in 2023.
While these figures are modest, they are just the prelude to an expected sharp ramp up in production – starting in 2024 – which will see the mine producing at a rate of almost 200 000 carats a year by 2026 and over 300 000 carats a year by 2028, Newfield’s CEO KARL SMITHSON, tells ARTHUR TASSELL.
The Tongo diamond mine, which is an underground operation, is the result of many years of exploration and development, first by Stellar Diamonds (an offshoot of Mano River Resources) and then Newfield.
Throughout this period, Smithson has been the driving force behind the project. An old Africa hand (he started his career with De Beers as an exploration geologist in Botswana in the late 1980s), he has focused almost exclusively on the West African region over the past 25 years, particularly Sierra Leone and Liberia.
He recalls that one of the early milestones on the project was a deal he negotiated with Octea Mining (which operates Sierra Leone’s main diamond producer, the Koidu mine) in 2017 which effectively brought Octea’s Tonguma property into the Tongo diamond project.
“This really gave us the critical mass to move forward, as it combined the kimberlite resources at Tongo with the resources of the adjacent Tonguma licence,” he says.
“The area covered by the licences totals 134 km2 and hosts 11 known kimberlite bodies, mainly dykes.” This consolidation did not immediately lead to Stellar, which was listed on AIM, embarking on mine development.
“The problem was that Stellar was very much a junior company and just couldn’t raise the start-up capital required,” says Smithson.
“We needed a partner with access to funding and we found one in Newfield Resources, an ASX-listed company which had some alluvial mining assets in Sierra Leone.
Stellar was acquired by Newfield in 2018 and I stayed on with the expanded entity with my brief being to take the Tongo diamond project into production.”
Tongo diamond project: a highly economic project
With the merger in place, South African mining engineering consultancy PPM was commissioned to undertake a Front End Engineering and Design (FEED) study on Tongo, building on its earlier work which saw it completing a Preliminary Economic Assessment (PEA) in 2016 for Stellar.
The FEED study delineated a technically robust and highly economic project able to produce 260 000 carats (260 kct) at peak over an initial eight-year life of mine based on a 1.1 million carat (1.1 Mct) ore reserve on just two kimberlites, Kundu and Lando.
Based on the results of the study, Newfield embarked on mine construction in mid-2019 and by the end of 2020 – 12 months after the initial decline blast – was able to report the recovery of the first diamonds.
Extracting maximum value
Smithson confirms that Newfield has invested over US$70 million in the Tongo diamond project to date, a surprisingly small amount given the projected size of the mine.
“As a junior, one has to do everything very economically,” he observes. “We’re very self-reliant and have learnt how to extract maximum value from every dollar we spend.”
The two kimberlite dykes currently being exploited by the mine – Kundu and Lando –have a resource of 5.8 Mct between them. The total resource of the Tongo diamond project, however, is 8.3 Mct in the indicated and inferred categories, based on just five of the 11 known diamondiferous kimberlites within the project area that have thus far been evaluated. The orebodies, all open at depth, are high-grade, varying from 90 carats per hundred tonne (cpht) up to 320 cpht (in the case of Kundu).
A multi-generational opportunity
“This is a project offering plenty of ‘blue sky’. Once we are well established with the development of Kundu and Lando, we anticipate bringing Tongo Dyke-1, which has a resource of 1.4 Mct, into the mix and this will lift annual production to almost 400 kct. Development of the Panguma orebody – which currently has a resource of 0.9 Mct to a depth of 100 m – could then follow. At this stage, only Kundu, Lando and Tongo Dyke 1 are in the mine plan, but they can give a 17-year life of mine based on our updated mine scheduling,” says Smithson.
He adds that the Tongo diamond project could be operating for decades yet. “We regard it as a multi-generational opportunity. There is still a massive amount of exploration to be done and the likelihood is that our resource base will grow significantly. Moreover, the project is based on fissure mining.
South African experience is that mines of this type can go ever deeper and operate over decades. The Helam mine, for example, has been operating since the 1930s and is now down to about 600 m. Our current resource for Kundu and Lando is all within 240 m of surface.”
Sierra Leone is known for the quality of its diamonds and the product from the Tongo diamond project is no exception. “The diamonds we’re recovering are of excellent colour and clarity,” says Smithson.
“Our first diamond sale last year of 5 330 carats realised an average price of US$269 per carat. Some of these diamonds were from a now discontinued alluvial operation but the vast majority – totalling 5 128 carats – were from the Tongo diamond project and sold at an average price of US$262 per carat, which comfortably exceeded our first modelled diamond price of US$222 per carat.
“An independently generated revised diamond price model based on the statistics from the diamond sale indicates a run of mine price of US$251 per carat, which is consistent with our first sale results.”
The Kundu and Lando kimberlites are accessed from a single portal entrance located approximately midway between the two kimberlites.
The decline system starts as a single 6 x 4 m decline but 150 m in from the portal bifurcates into two 4 x 4 m declines, one accessing the Kundu orebody and the other the Lando orebody.
The Kundu decline is by far the more advanced and the Kundu orebody is the source of all current ore production.
Traditional shrinkage stoping
The selected mining method is traditional shrinkage stoping with a 0.85 m mining stope width, although in practice this is being improved with 0.65 m achieved for the latest stopes to come into production. According to Smithson, this reflects not only careful charging and blasting but also the fact that the host rock is granite.
“The result is that we have very competent granitic side walls which provide very stable hanging and footwalls, allowing the ore to be extracted with minimal dilution,” he says.
“By contrast, many fissure mines in South Africa must contend with shales which make it extremely difficult to control dilution. At the Tongo diamond project, we’re beating our forecasts on dilution by about 30%.”
The equipment used for the decline development and the level drives includes two 15-t capacity haul trucks, two jumbo rock drills and two LHDs, all sourced from a Chinese OEM.
The stopes are hand-drilled. The equipment fleet will grow with time as the mining levels – there are six in the current mine plan to a depth of 200 m – are incrementally brought into production.
At present, only level 1 of Kundu is operational with four stopes currently active.
Newfield carries out the mining in house. “We have a workforce of around 270 people, which includes 36 expats from countries in Africa and overseas,” says Smithson.
“Ultimately, this will grow to over 500 people. The employment we’re providing is having a big economic impact, as formal sector jobs in this part of Sierra Leone are very scarce. We’re pretty much the only significant employer in the area.”
Most of the labour is recruited from and live in the neighbouring communities but Newfield does have on-site accommodation for 65 people.
The accommodation is of good quality, with all units en-suite. The ore derived from the Tongo diamond project is currently being processed in a 5 t/h DMS plant.
“This is a bulk sample plant that we used for years during our exploration, but we’ve beefed it up to cope with its new duties,” remarks Smithson.
“It’s capacity will be exceeded by the end of this year so we’re very advanced with plans to replace it with a 50 t/h plant.
This will be based on a production plant that was relocated from Koidu to Tongo as part of the Octea deal but it will have new designs for the scrubbing and screening, final recovery, and sort house. We’ve budgeted US$1.2 million for the exercise.”
He adds that when Tongo Dyke-1 – which is 9 km from Tongo’s main camp – enters production it will require a new decline system but will probably not have a full-scale standalone plant.
“Our present thinking is that we will have a small 20 tph DMS plant at the site for pre-concentration and that we will haul the product from this to the main diamond recovery unit at the 50 t/h plant.”
Management of the mine
After having lived almost continuously in Sierra Leone for five years to get the Tongo diamond project up and running, Smithson is now based in the UK, although he continues to visit site regularly.
The day-to-day management of the mine is now the responsibility of Charl Barnard, who was appointed GM in early 2022.
He is a well-respected diamond mining industry veteran with a long track record in the industry including 15 years with Petra which saw him – among other things – managing the famed Williamson mine in Tanzania.
Commenting on Sierra Leone as a mining destination, Smithson says the country is a good mining jurisdiction with royalties that are low compared with Botswana.
“We have no complaints and enjoy a good relationship with the authorities. We also find the country stable and certainly we’ve never had any security concerns.
The country’s infrastructure though is under-developed, so we must take care of our own needs in terms of services such as water and power.”
Looking back on the development of the Tongo diamond project, Smithson says it has taken longer than expected. “COVID was a major problem, as it really slowed progress, and we also had some funding issues,” he states.
“Things could have gone quicker for sure, but the mine is now working well and is ready to fly. We’re confident that we will be cash positive within 18 months and that Tongo diamond project will establish itself as a high-margin, long-life operation that will give a significant boost to Sierra Leone’s diamond mining industry.”
SOURCE:miningreview.com
