Merlin Diamonds Limited has being investigating the use of borehole mining at Merlin, as a means to optimise the economics of ore extraction at Merlin. Borehole mining involves the use of high pressure water jets to cut and break rock formations in a drill hole with the resultant slurry being pumped to the surface. Borehole mining can be undertaken to a depth of at least 500 metres. • Merlin Diamonds Limited is working with Kinley Exploration, a US Company with an established operating history in relation to borehole mining and the extraction of diamonds, including undertaking work at Diavik (Rio Tinto) and Ekati (BHP) Diamond Mines (where Kinley were getting good lift at 600metres depth). 10
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Merlin Diamonds Limited has being investigating the use of borehole mining at Merlin, as a means to optimise the economics of ore extraction at Merlin.
Borehole mining involves the use of high
pressure water jets to cut and break rock formations in a drill hole with the resultant slurry being pumped to the surface.
Borehole mining can be undertaken to a depth of at least 500 metres.
• Merlin Diamonds Limited is working with Kinley Exploration, a US Company with an established operating history in relation to borehole mining and the extraction of diamonds, including undertaking work at Diavik (Rio Tinto) and Ekati (BHP) Diamond Mines (where Kinley were getting good lift at 600metres depth).
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Kinley have completed a feasibility study and will begin a borehole mining trial at Merlin in Q2 2013 with a view to commencing commercial production in Q3 2013.
The Company intends to proceed with the borehole mining trial after the conclusion of the 2012/13 wet season and will initially focus on PalSac then Ywain kimberlite pipes.
A borehole mining operation incorporating Gwain, Ywain, Excalibur and Palsac to 200 meters could have a potential carat population of 3.13 million carats, and a mine life of 15+ years. With opportunity to extend the mine life by incorporating other pipes at Merlin, or extensions to Gawain, Ywain, Excalibur and/or Palsac.
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Borehole mining is a proven technique for diamond extraction from Kimberlite pipes to depth, and has being successfully used by major diamond mines including Ekati (BHP) and Diavik (Rio Tinto)
Borehole mining removes the need for pit cut back and associated waste removal
No requirement for significant mining fleet, comprising excavators, haul trucks, loaders and other associated capital equipment
No requirement for drill and blast
Reduction in labour and capital equipment, results in reduced infrastructure requirements, related support staff, and working capital required for consumables such as diesel fuel, spare parts etc.
The above factors result in making borehole mining an economically attractive alternative to conventional open pit mining, with lower capital risk, and improved IRR and NPV
As bore-hole mining does not require significant waste removal, development of ROM pads, large diesel fuel farms and explosives; there is a reduced environmental footprint compared to conventional mining, thus reducing rehabilitation costs and mine closure planning
The above factors result in making borehole mining an economically attractive alternative to conventional open pit mining, with lower capital risk, and improved IRR and NPV
Merlin Accommodation Camp; Kitchen and Administration Facilities
Merlin Mine Private Airstrip
Rio Tinto’s 1997 feasibility study on the Merlin Diamond Project made the following comments in regard to: › Discovering more small pipes:
“Small pipes, such as Ywain, may be fairly common in the field,…..”
› Discovering more large pipes: “There is some potential for significantly larger pipes,….”
› Discovering new kimberlite fields: “Within 100km radius of Merlin, there are seven areas in which both indicators,
microdiamonds and in some instances commercial sized diamonds, have been recorded. A small kimberlite pipe was found at one location, in a structural position similar to the pipes at Merlin. This evidence indicates that the Merlin field is part of a broader kimberlite province.” and..
“ These factors (cretaceous cover, poor preservation of indicator minerals) while inhibiting the exploration effort, generally increase the possibility of other kimberlite fields and larger pipes to be present in the province.”
Lancelot / Tintagel – High priority target area
Evidence of commercially sized diamonds, microdiamonds and indicator minerals strongly suggest presence of a second diamond field
Trench mapping and heavy mineral sampling has led to the identification of indicator mineral bearing eluvial material, further trenching and sampling has been completed with samples being processed
Arnhem Land – Under explored but highly prospective for diamond bearing Kimberlites
Merlin Diamonds has a contractual right to obtain an 80% interest in 2 tenements in the prospective western region of Arnhem Land. These tenements are at the application stage
Seppelt Pipes, North Kimberly – Mining lease continues to retain commercial potential
Merlin Diamonds has identified an Inferred Resource of 1.57Mcts within the Ashmore, Seppelt 1 and 2 Kimberlite pipes, with Seppelt 2 having an exceptional grade of over 180cpht
Borroloola is one of Merlin Diamonds’ most exciting
prospects.
Represents a significant and unique opportunity to explore for
a large volume, high value, alluvial diamond deposit
Two granted tenements cover an area of approx. 1,150km²,
approx. 100km north of Merlin
Only major alluvial concentration at a low point, in this
catchment, known to host significant diamond deposits
Alluvial gravels drain through the MacArthur River, deriving
material from the catchment that contains the Merlin
kimberlite field and the Abner Range
The work program began in Sep 2011, following approval of a
Mine Management Plan
By the Dec 2011 quarter, Merlin Diamonds had extracted 5000
tonnes of alluvial material from 5 different work areas
3000 tonnes of material from 3 pits have been processed at
the Merlin Mine
22 diamonds weighing a total of 1.09cts were recovered and
diamond quality to be assessed upon completion of processing
Results to date confirm that the Borroloola Alluvial Gravels
host a macro-diamond population
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Mr. Joseph Gutnick Executive Chairman and Chief
Executive Officer
A leading mining industry entrepreneur, Mr Gutnick is the
President/ Chairman and CEO of the Gutnick Network of Companies. He was responsible for overseeing the discovery of the Plutonic 11 million
ounce gold deposit and the discovery, development and operation of the world class
Bronzewing and Jundee gold mines in Australia. Mr Gutnick is a Fellow
of the Australian Institute of Mining and Metallurgy, a Fellow of the AIM,
a Member of the Institute of Company Directors in Australia, and a former Director of the World Gold
Council. He was awarded the prestigious Diggers award at the
1997 Diggers and Dealers Industry Awards.
Mr. Craig Michael Executive Director
Mr. Michael has extensive experience as a geology
professional in the mining and resources industry. He is
currently Executive Director of the Gutnick Network of
Companies including Director of Merlin Diamonds Ltd, Aurum,
Inc. and Chief Executive Officer of Paradise Phosphate Limited.
His previous work was with Oxiana Ltd in South East Asia and Sons of Gwalia in the goldfields
of Western Australia. Mr Michael is a member of the Australian
Institute of Mining and Metallurgy and a Member of the Institute of Company Directors in
Australia.
Mr. Henry Herzog Non-Executive Director
Mr. Herzog has over 40 years of corporate experience and
has served in various positions as President, Vice President, and Director of a
number of listed public companies in the mining and exploration sector, both in Australia and the United
States.
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Dr. David Tyrwhitt Non-Executive Director
Dr Tyrwhitt has been involved in the diamond exploration industry
since 1959 when he was first employed by De Beers in Tanzania
as a diamond exploration geologist. He was the CEO and Managing Director of Ashton Mining Ltd from 1988 to 1991 where he was involved in the exploration and feasibility of
diamond deposits in Australia (including Merlin and Argyle),
Scandinavia and South East Kalimantan Indonesia. Since leaving Ashton, he has been
involved in diamond exploration in Canada, China and Australia. Dr
Tyrwhitt was chairman of JORC and whilst there introduced the
