Botswana Diamonds yields control of South African project to contractor

Botswana Diamonds (LON:BOD) has signed a contract with Palaeo Minerals covering full-scale mining activity at the Thorny River project in South Africa, which the company believes will become its first operating mine.

The agreement, which sees Botswana Diamonds handing over control to the contractor, will allow the company to self-fund the project from bulk sampling through to mine development, it said in a statement.

In return, Botswana Diamonds – through its partner Vutomi – will receive a 12% net royalty revenue and a further 8% to cover state mineral royalties, sales and security expenses. The balance of the project will be owned by the operator, Palaeo Minerals. Indicated net royalties could be between $2 million and $7 million a year.

Company believes the Thorny River…

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