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Creamer Media's Mining Weekly Online

Octéa Diamond Group launched at Koidu diamond mine

By: Leandi Kolver
Published: 3rd August 2012

Mining company Octéa Diamond Group, a private company owned by Beny Steinmetz Group (BSGR), was officially launched at a gala event at the group’s flagship Koidu diamond mine, in Sierra Leone’s Kono district, last month.

The event also marked the official opening of the Koidu mine’s new 180 t/h processing plant, which will boost diamond output from 10 000 ct/m to 45 000 ct/m during the third quarter of this year.

Towards the end of 2011, Koidu Holdings underwent major restructuring to enable the group to invest in other exploration and development opportunities in Sierra Leone, and Octéa Diamond Group was formed.

“We chose the name Octéa to reflect the quality of the octahedral diamonds characteristic of our diamond deposits in Sierra Leone,” said CEO Jan Joubert.

Four wholly owned subsidiaries of Octéa Diamond Group have been established: Octéa Mining, Octéa Diamonds, Octéa Services and the Octéa Foundation.
“Octéa Mining now owns the mining assets of the group, including the Koidu diamond mine and the Tonguma project,” said Joubert.

“An application for an exploration licence to the east of Koidu, which contains the third of the kimberlite pipes in the region, was awarded to newly formed Octéa subsidary Boroma on July 23. Core drilling to delineate the pipe and associated dyke zones will start within the next month.”

Speaking at the launch, Joubert stated the successful implementation of the Koidu expansion project would enable the company to generate a healthy return on capital.

“Even during economic downturns the 180 t/h mine configuration should generate a return and while the current life-of-mine plan is for 15 years, we believe it could be extended by at least another 10 to 15 years,” he said.

Meanwhile, a few days before the launch, the company signed a 25-year mining lease agreement on the Tonguma property in Tongo.

The first phase of economic evaluation at Tonguma is taking place and a feasibility study should be concluded in the first quarter of next year, Joubert said.

“We aim to start developing our next mine there, and believe Tonguma’s potential, in the size of the resource and life-of-mine, might even overshadow that of Koidu,” he said.

“Apart from Koidu and Tonguma, Octéa is actively pursuing further opportunities. “We want to be producing at least two-million carats by 2018,” he added.

More than $300-million has been invested by BSGR in Octéa and its surrounding communities in Sierra Leone to date. A long-term, off-take agreement is also in place with renowned diamond brand retailer Tiffany & Co.

The Koidu expansion project incorporates all the currently evaluated kimberlite resources on the mining lease property, said Joubert.

The richer K1 kimberlite pipe, which was mined by vertical pit methods from 2005 to 2007, has been redeveloped and brought back into production this year, while the new 180 t/h processing plant will ramp up production from the K1 and K2 openpits.

Optimisation studies indicated that the two openpits would be economic to depths of 310 m for K1 and 240 m for K2. At average mining rates of 100 000 t/m of ore and 1.4-million tons a month of waste, the openpit phase of the expansion project will continue until the end of 2015, he said.

“In 2015, the underground operation will start drawing ore from the two kimberlite pipes and from the four small blows developed along two of the four kimberlite dyke zones currently included in the mine plan.”

Development of the portal will start towards the end of 2012 to have the underground infrastructure in place by 2014. Longhole open stoping is the mining method selected for the K1 and K2 orebodies, with no crown pillar left between the openpit and underground operations. Mechanised longhole stoping will be used for mining the kimberlite dyke zones, said Joubert.

The mine’s current defined indicated and inferred resource amounts to more than 14-million tons at grades ranging from 0.32 to 0.76 carats a ton. An additional 3.7-million tons of kimberlite was drilled and classified as geological potential, which will be upgraded into the resource statement in the next phase of resource extension and evaluation.

The main challenge Octéa had to overcome involved the supply chain and logistics, owing to the remoteness of the project.

“As shipping takes between 9 to 16 weeks, if a component was incorrectly engineered, it would not have been possible to rectify it quickly. Therefore, the entire plant was manu- factured, trial-erected and water-tested in South Africa to identify any potential problem areas prior to being dismantled and packed in containers for shipping to Sierra Leone,” Joubert explains.

Running in parallel at Koidu were the site establishment, earthworks, civil engineering and the laying of foundations, which enabled the erection of the plant to start immediately after the 216 shipped containers had arrived on site.
Despite the metal workers strike in South Africa during the critical manufacturing stages and the coup in Côte d’Ivoire, which disrupted shipping routes, the plant was still commissioned within the planned timeframes.

The diamonds mined at Koidu enable the company to finance numerous development initiatives, said Joubert.

“Country and community initiatives undertaken by the company, to date, include clean water supply to the Kimbadu resettlement village, education facilities and programmes, a road refurbishment programme, infrastructure development, healthcare programmes, agriculture projects, feeding schemes, local business development programmes, a sports development programme, an employee development programme and employee welfare. Most of these initiatives are ongoing,” he said.

The Octéa Foundation, which focuses on community development, wants to further enhance these initiatives through the provision of clean water for the town of Koidu and the establishment of a malaria prevention programme, as well as national education programmes.



The subheadline of the story on the launch of Octéa Diamond Group, on page 21 in Mining Weekly’s August 3, 2012, edition, stated that Koidu Holdings is now called Octéa Diamond. Actually, Koidu Holdings is now called Koidu Limited, a subsidiary of Octéa Mining, which now owns the mining assets of the group, including the Koidu diamond mine, in Sierra


Corporate Structure

Since 2003, Beny Steinmetz Group Resources Ltd (BSGR), the shareholder of Koidu Holdings S.A. (Societe Anonyme), through BSG Diamonds Ltd, has invested over $300 million into the development of the Company and the upliftment of our communities.

Inspired by the success of the Koidu and Tonguma operations, a major restructuring exercise was initiated towards the end of 2011 to enable the group to invest in other exploration and development opportunities in Sierra Leone and to attract financing partners for the injection of a further anticipated $600 million to $1 billion into the country’s mining sector.

BSG Diamonds was renamed OCTÉA Ltd to reflect and honour the spectacular quality of the abundant octahedral diamonds characteristic of the diamond deposits in Sierra Leone. Four wholly owned subsidiaries of OCTÉA Ltd were established namely: OCTÉA Mining Ltd, OCTÉA Diamonds Ltd, OCTÉA Services Ltd and the OCTÉA Foundation.

OCTÉA Mining Ltd now owns the mining assets of the group, including the Koidu Kimberlite Project held by Koidu Ltd (previously named Koidu Holdings S.A.) and the Tonguma Project held by Tonguma Ltd.


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