Canadian mining outfit penetrates SA ind...

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Canadian mining outfit penetrates SA industry

Since Jennings took the reins of SouthernEra four years ago, it has acquired stakes in an array of properties in 10 countries, including South Africa, Canada, Venezuela, Angola, Swaziland, Uruguay and Ukraine. According to Jennings, "it's a high-risk business, and we've got to spread our risks".

SouthernEra hopes are pinned on its Klipspringer property in the Northern Province. A feasibility study is due in early 1997. "I'm sure we've got a viable mine there," Jennings says. More than 3 000 carats, mostly of gem quality, have been recovered. They average 0,31 carats and include 15 gemstones of over four carats.

According to Jennings, the 62 km-long Kimberlite fissure in which the stones have been found is about six times longer than any other in South Africa.

The capital cost of an underground mine is estimated at a relatively modest $30-million. Production costs, estimated at $25 a ton, could be held down for up to 20 years by tunnelling horizontally into the mountain.

SouthernEra gained access to needed cash flow last month by teaming up with a small company with sizeable concessions in Angola's rich diamond fields.

Sphere Trading, is run by two former SA policemen who found 800 carats of diamonds worth nearly $1-million in one day. Since then Sphere has extracted 45 000 carats of diamonds, valued at about $920 a carat, from 156 000 ha of concessions in Lunda Norte province.

Jennings says his partners are among the few diamond hunters not deported in recent weeks.

Angola "is going to be one of the world's leading diamond centres, if peace can hold. The government is very serious," he says.

Jennings worked for many years for Falconbridge, the Canadian metals producer. His reputation has caught the eye of some of the biggest producers. RTZ-CRA, the Anglo-Australian group, is SouthernEra's biggest shareholder, with 18,25%. Swiss and French Banks own 12% to 13%. - Financial Times

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