Firestone raises £13m for Liqhobong development

3rd Dec 2010 13:28

Firestone Diamonds is raising £13m in order to finance the development of the Liqhobong diamond mine. Plant 1 at Liqhobong is scheduled to commence production in the first quarter of 2011 and Firestone intends to treble capacity by the end of 2011. This plant could generate annual revenues of $36m and a second plant is being considered. The Liqhobong mine has produced diamonds in the past but mining was ended when the diamond price fell. AIM-quoted Firestone wants to produce 1m carats per annum by 2014. Firestone has a 75% stake in the Liqhobong mine in Lesotho, which has a resource of an estimated $2.7bn worth of diamonds - at $86/carat. The shares are being issued at 25p each but the company can only issue just over half the shares immediately. Firestone needs to secure shareholder approval for the issue of the additional shares at its AGM on 23 December. Firestone completed its all-share offer for Kopane Diamond Developments, the owner of Liqhobong, in the autumn.