INVESTMENT: US$15 million

Matshego Business Concepts (Pty) Ltd

The Lerala Diamond Mine is an operating mine located in eastern Botswana, 300 km north-east of the capital Gaborone and 30 km north of the Martin’s Drift border crossing into South Africa. The project falls within Mining Licence 2006/29L and comprises five diamondiferous kimberlite pipes representing the diamond resource and making up a combined surface area of 6.42 ha that were discovered by De Beers in the early 1990s. Four of the kimberlites are within 2km of each other and the fifth, K2, is located approximately 5km from the four bodies.

Locality Map

Fig. 1: Location of the kimberlite pipes and processing facilities that comprise the Lerala Diamond Mine

Historical ownership

The tenement was acquired by De Beers in 1988 and in the early 1990s the company discovered the Lerala cluster of kimberlites by conventional soil sampling techniques and geophysics. Following a trial mining operation, De Beers relinquished the licence covering the Lerala kimberlites in 1996.

DiamonEx Limited through its subsidiary DiamonEx Botswana Limited acquired a prospecting licence in 2002 and following a positive evaluation programme, applied for a mining licence which was issued in 2006. DiamonEx constructed a processing plant that cost in excess of US$20m and the mine went into production in mid-2008 before going into judicial management in January 2009. It considered that the main reasons for failing were the result of the processing plant not achieving design throughput tonnages, the recovery section of the plant not operating efficiently and the impact of the price crash as a result of the global economic.

Following a positive due diligence study in late 2009, Mantle Diamonds Limited acquired the Lerala project. DiamonEx was then acquired by Mantle which undertook a modelling exercise to confirm the resources and assess and establish the grade variability within the resources for subsequent reserve modelling, and also designed the final pits for each of the resources. Mantle had also undertaken a substantial refurbishment of the plant and equipment focusing on critical engineering modifications to optimise processing and security. Trial mining commenced in March 2012, but production was later suspended on 31 July 2012 and the mine placed on care and maintenance.

In September 2013 Kimberly Diamonds Limited (KDL) made an offer to acquire full equity in Mantle Diamonds Ltd in the form of 13.6 million new ordinary shares, including the Lerala diamond mine after Mantle had completed capital restructuring. After acquisition, KDL updated Resources and Reserves based on the Mantle Diamonds geological model. Recommenced mining operations in 2016, with no additional exploration work being undertaken on the property since acquisition from Mantle Diamonds. By May 2017 Lerala Diamond Mines Limited, the Botswana-based subsidiary of Kimberly Diamonds Limited, was placed under judicial management, after being forced to suspend operations because of inability to source the required funds to continue its operations. The mine was being closed for the third time in its history, after closures in February 2009 and in July 2012.

Maroon Capital (Pty) Ltd currently owns the mining rights on the tenement and all the assets associated with the entire mining operation, which is currently under care and maintenance.

Geological Models of the Lerala Pipes

Drilling and Sampling

The lithological models and corresponding grade distributions underpinning the Resource estimate are based on drilling and sampling undertaken by previous owners of the project.

During 1992, De Beers carried out a Large Diameter Drilling (LDD) program comprising 36 holes drilled over K2-K6 on a nominal 40 m grid. Holes were 12” (305 mm) diameter and approximately 110m deep using percussion drilling techniques. Samples were recovered from 20 m intervals for a total of 618 tonnes of sample from 31 holes. As part of the same program, pits and trenches were excavated in K2 to K6 for the recovery of approximately 1,325 tonnes.

During 2004-5, DiamonEx drilled a total of 27 x 17.5” diameter LDD holes using a Reverse-flush-air-assist or RC air hammer drilling techniques of which 18 were sampled at 20 m intervals. In addition, 11 pits were excavated for the recovery of a total of 4,946 t.

In all, a total of 121 holes have been drilled into the Lerala kimberlites.

Table 1 - Previous drilling undertaken at the Lerala Diamond Mine

Lerala Diamond Mine Kimberlites


The dominant country rock is leucocratic pink granite gneiss with occasional amphibolite dykes. Dolerite dykes have also been encountered.

3.14 Mt @ 25.45 cpht for 799,000 carats

K2 lies to the extreme south-west of the mining lease. The body has a highly complex morphology covering a total of 2.13ha and is elongated in an EW orientation. The pipe has a maximum length of approximately 500m and a maximum width of around 50m, with a minimum width of 11m.

The central areas are composed of hypabyssal kimberlite breccia, which has incorporated significant quantities of granite-gneiss, amphibolite and dolerite country rock. The lobes to the east and west are made up of relatively undiluted hypabyssal kimberlites, while close to surface in the west lobe is a small area of tuffisitic kimberlites breccia. Large blocks of county rock are prominent within the pipe.


The kimberlite has a fragmental appearance due to abundant angular to subrounded country rock xenoliths set in a kimberlites matrix. Xenoliths of 0.3 - 3m are common with occasional blocks of up to 20m diameter present.

4.34 Mt @ 38.11 cpht for 1,654,000 carats

K3 is the largest of the pipes within the project area with a surface area of approximately 2.06ha. It is a north-south oriented bell-shaped pipe with a maximum width of 200m in the south, and 10m in the north.

At surface the pipe is mainly composed of tuffisitic kimberlites breccia with a highly diluted marginal breccia on the western margin. At depth a zone of hypabyssal kimberlites breccia becomes prominent.

The kimberlite has a fragmental appearance due to abundant angular to subrounded country rock xenoliths set in a kimberlites matrix. Xenoliths of 0.3 - 3m are common with occasional blocks of up to 20m diameter present.


Marginal breccias are common at the margins of the pipe and around floating reefs and contain very little kimberlite.

0.91 Mt @ 46.48 cpht for 423,000 carats

K4 is a NNE/SSW oriented pipe with a central narrow neck. The pipe has a surface area of approximately 0.77ha with a maxi length of 250m and a max width of 50m.

The tuffisitic kimberlites breccia is the dominant kimberlite type within the pipe. It occurs in the northern and southern parts of the pipe, and contains country rock xenoliths up to a couple of metres, but generally less than a few centimetres.

The kimberlite breccia occurs in the middle and in the south of the pipe, and is very competent where silicification has occurred. Xenoliths are mainly granite-gneiss and amphibolite and mostly 10-50mm in size, and form 30-40% of the rock.

Hypabyssal kimberlite is present as isolated plugs and narrow dykes intersecting the TKB. The dykes are generally 50-100cm across.


The hypabyssal kimberlite occurs as dykes of 1-15m across. Marginal breccias are not common, but floating reefs of 2-5m diameter are present.

1.54 Mt @ 17.79 cpht for 274,000 carats

K5 is ellipsoid in shape with an area of 1.03ha and a maximum length of 150m and maximum width of 90m.

The pipe is composed mainly of hypabyssal kimberlites breccia with minor hypabyssal occurrences with very few large blocks of country rock present. The kimberlite is generally very fresh and competent. The breccia contains 40-70% country rock xenoliths mostly 1-15cm in size and mainly composed of pink leucocratic granitic gneiss and amphibolite.


0.29 Mt @ 30.69 cpht for 89,000 carats

K6 is a linear body oriented north south. It is 0.26ha in size with a north south length of approximately 150m and a maximum width of 30m.

The pipe is composed mainly of hypabyssal kimberlite. Near the centre of the pipe, a zone of hypabyssal kimberlite breccia is present. Xenoliths of up to 20cm in diameter are common and composed of granitic gneiss and amphibolite.

Marginal breccias are present along the eastern contact and around the 3-4m diameter floating reef near the centre of the pipe.

Production Schedules

Fig. 4: Production scheduling

The mining plan for Lerala Mine was to mine the largest of the pipes, K3 and K2 first by conventional open pit methods, over a period of 51 months starting in Month 5 of the schedule, followed by the mining of the other 3 pipes. Mining operations would be contracted out and analysis of tender submissions would also provide good input into the expected mining costs in the financial model for the project.

Mining would start at K3 with a total of 8,7 Mt (3,4 MBCM) of ore, waste and low-grade material to be mined by open pit mining to a depth of 146 m below surface. A further 8,4 Mt (3,2 MBCM) of ore, waste and low-grade material would be mined from the K2 pit to a depth of 93 m below surface resulting in a total of 17,1 Mt (6,6 MBCM) being mined in total over 4,25 years.

The proposed Life of Mine mining schedule of the Lerala Diamond Mine extended over 74 months during which a total of 28.43 Mt of rock would be mined. Of 28.43 Mt mined, 8.89 Mt is considered ore, 2.11 Mt is considered low-grade ore and 17.43 Mt is considered waste giving the project an overall strip ratio of 2.20.

The planned mining method would be a conventional open pit mining operation comprising of 5-meter benches, divided into 2.5-meter flitches. The design parameters for the pits would comprise 10-meter benches with 4-meter-wide berms, and access ramps of 12 meters wide. Ore loss during mining is assumed to be 0% due to the well-defined contacts, competent wall rock, the planned use of separate ore and waste blasting and relatively small mining equipment. In order to minimise ore dilution, it was planned that ore and waste blocks would be blasted separately.

The proposed Life of Mine processing schedule for the Lerala Diamond Mine extended over a 79-month period during which a total of 8.99 Mt of ore would be processed. The ore tonnes comprising the production schedule are 93% sourced from the Indicated portion of the Resource, with 5% coming the Inferred portion of the Resource and 2% deemed an ‘exploration target’.

TExisting ore grade ROM stockpile would be fed first followed by fresh ore processed in the same sequence that it is mined. A recover factor of 95% percent has been applied to account for typical diamond loss through the processing circuit. A total of 2.5 million carats would be recovered at an average grade of 27.81 cpht.

The planned steady state production throughput of 1.4 Mtpa equates to the 200 tph plant operating at maximum capacity for an average of 19 hrs per day.

Table 2 - Plant Feed source and carats recovered from the Life of Mine plan

Fig. 5: Gem quality diamonds recovered from the Lerala Diamond Mine

Fig. 6: Distribution of diamond mines and other kimberlites in Botswana