No-nonsense diamond miner GeoCrystal is getting ready to IPO
GeoCrystal is a no-nonsense diamond explorer being brought to the ASX in a $7 million initial public offering.
Being of the no-nonsense type means there is no mention in the prospectus of the legend of Stansmore’s diamond.
Said to have weighed 25 carats in the rough, the diamond was found in the possession of Charles W. Stansmore after he was killed in a shooting accident on the 1896 expedition from Coolgardie to Halls Creek, led by explorer David Carnegie.
The source of the diamond is still not known, if in fact it was a diamond, as Carnegie’s diary only reported “something of great interest’’ being found with Stansmore’s body.
But the diamond legend lives on.
Where GeoCrystal comes in to the story is courtesy of its advanced Webb diamond exploration project, in the West Arunta region of the Gibson Desert in Western Australia some 500km south of Halls Creek.
It turns out the Carnegie expedition moved through the same general location before Stansmore met his end, just short of reaching Halls Creek.
Again, there is no mention of the Stansmore legend in GeoCrystal’s prospectus.
But the mystique of it all lends some colour to the technical aspects of the Webb project, home to the biggest cluster of kimberlites (a host rock for diamonds) found in more 20 years.
More than $4.7 million has been spent by GeoCrystal as an unlisted company exploring the kimberlite field since its discovery in 2013.
The exploration identified 51 individual kimberlite bodies with the drill bit and another 216 likely kimberlite targets remain to be tested.
The area is sand dune country, with the kimberlites obscured by sand cover and capped by sediments.
Micro-diamonds (less than 0.5mm) have been encountered in the surface sands in the area and because of their shape, the suggestion is that the diamond source is not too far away, possibly from one or more of the kimberlite bodies.
GeoCrystal is planning to kick off a drilling program in the September quarter to drill the kimberlites below the diamonds being found at the surface.
Founders of the Australian diamond industry
It comes to the market with two “founders’’ of the Australian diamond industry, Tom Reddicliffe as technical director, and Ewen Tyler as a consultant.
The men both hail from Ashton Mining, a partner in the Argyle diamond mine before it was taken over by Rio Tinto in 2000.
Tyler told Garimpeiro that the timing was right for a new ASX-listed diamond explorer.
(Stockhead can confirm the IPO is back on after a delay related to some minor glitches with ASIC).
“We haven’t had one for such a long time. This is something quite out of the bag in my view. We have never really seen anything like this in Australia with so many kimberlite pipes,’’ Tyler said.
The IPO also includes an 80% interest in the Merlin South diamond project in the Northern Territory, 40km south of the Merlin diamond mine (discovered by Reddicliffe) which produced high-quality white diamonds, including Australia’s biggest ever stone (105 carats), for various owners.
A big anomaly (7km by 4km) has been identified at Merlin South from which high concentrations of microdiamonds and some macro-diamonds (more than 0.5mm) have been identified.
Should GeoCrystal raise the full $7 million from the issue of 35 million shares at 20c each (it has a minimum $5 million subscription requirement), it will have 104 million shares on issue.
Interests associated with the incoming chairman, Yu Qiu Ming, will hold about 30% of the company.
A businessman from western China, Mr Yu has been involved in copper-zinc mines in China, as well as diamonds in Tanzania, and is chairman of ASX African gold explorer Amani Gold.
He is an associate of the underwriter which is covering $2.5m of the public offering.