EHR signs diamond exploration alliance

EHR Resources has signed a strategic alliance with a privately owned company focused on diamond exploration in Botswana, marking its third diamond deal in three months.

The announcement comes after EHR signed an earn-in agreement with North Arrow Metals over the Naujaat diamond project in Canada earlier this month, and completed the purchase of Nanuk Diamonds in March.

EHR has now signed an agreement with Botswana-based Diamond Exploration Strategies (DES) to fund $US1.5 million ($A2.2 million) in exploration over three years to earn a 50 per cent ownership in any discovery made.

EHR managing director Peter Ravenscroft said DES had a proven track record in Botswana that would provide the company with exposure to any potential discoveries.

“The alliance provides EHR with a turn-key entry into one of the world’s leading diamond jurisdictions with an experienced local partner,” he said.

“Having a generative early stage exploration program in Botswana is a key component of our balanced portfolio of diamond investments, and follows our recent entry into more advanced exploration in Canada as we carefully execute our broader diamond sector strategy.”

Mr Ravenscroft said the alliance was an exciting addition to the company’s growing diamond portfolio.

DES chief executive Barry Bayly said both companies were “well aligned in terms of strategy and operational competence”.

DES will perform all exploration activities under the alliance.

EHR Resources could earn a 70 per cent interest in any project by sole funding a scoping study and up to 90 per cent by funding a feasibility study.

Its shares were trading 9 per cent higher to 12 cents per share, as at 2:20pm AEST.