British company Gemfields buys stake in ruby mine in Mozambique

12 December 2012

British company Gemfields has reached a provisional agreement to buy a majority stake in a ruby mine next to its own mine in Montepuez, in Mozambique’s Cabo Delgado province, said the company’s chairman Ian Harebottle.

Under the terms of the agreement a new company will be set up in which Gemfields, which is listed on the London Stock exchange’s Alternative Investment Market (AIM), will own 75 percent after payment of US$1.75 million. The seller, EME Investimentos, will own the remaining 25 percent.

The future company will have an exploration licence, with an option to buy 75 percent of a second licence. The two licenses will cover areas of 18,400 and 14,900 hectares.

Gemfields will have to pay the agreed amount in two instalments, the first of which within 14 days of signing the final contract, and an additional payment in the same amount if the company decides to exercise its option to buy the second mining licence.

Harebottle said that the initial results on samples collected at the project next to the Montepuez mine were, “very encouraging,” and said he was sure that the company would continue to invest and expand in Mozambique.

Rubies are the second-hardest gemstones after diamonds and are used essentially to manufacture jewellery. It is thought that Montepuez may have the world’s largest ruby deposit. (macauhub)