Jan 20, 2020

ALROSA to Assess Feasibility of Future Production at Mir Kimberlite Pipe

ALROSA announced late last week that it has commenced a study on the feasibility of production at the diamond deposits at the Mir kimberlite pipe. The study will be carried out over the next two years and a reserve estimate is expected to be ready by 2022, the company said.

It may be recalled that operations at the Mir underground mine were suspended in 2017 following a flooding accident. Subsequently, ALROSA had invited experts to present proposals related to safe and environmentally sound methods of accessing the diamond deposits within the pipe.

The present plan is linked to that process. Test drilling will be conducted by experts from ALROSA’s Vilyui Exploration Expedition who will start their studies at the depth of 1,200 – 1,600 meters below the surface. This will help to define more precisely the pipe’s dimensions, its position, diamond quality and grades, as well as geological conditions and hydrogeology of the deposit. Total exploration costs are estimated at RUB 2 billion.

“The bulk of drilling will be performed by VPT-NEFTEMASH LLC. This contractor, defined by a tender, has a record of successful construction of deep and ultra-deep prospecting and production wells for major oil and gas producers. It possesses state-of-the-art technologies for controlled-angle drilling and has its own facilities in Mirny and Lensk districts of Yakutia. Yakutniproalmaz institute will analyze all the information to prepare a feasibility study and a reserve estimate report,” said Sergey Khvostik, the head of Vilyui Exploration Expedition.

After finalisation of the report by the ALROSA Executive Committee, it will be submitted to the Russian State Commission of Mineral Reserves (GKZ).

The company will pay special attention to ensure industrial and environmental safety while carrying borehole exploration at water-bearing horizons and massive salt-saturated layers. 15 separate branches drilled from one main shaft will provide unique geological information on the deeper part of the kimberlite pipe. Another two vertical wells will provide data for the design of the future mine structure.

As per the concept approved in 2019, a decision about the future of the mine requires additional exploration of the deposit’s deep levels. Decision to restart the mine will depend on positive economics of the project provided the highest level of industrial safety both at the construction and mining stages can be achieved. If both conditions are met, a reconstruction of the mine may start no earlier than 2024. Preliminary estimates show that these works will take another 6-8 years, ALROSA stated.