- Nyota Minerals Ltd [LON:NYO] was the sector's biggest faller after it reported that its 100%-subsidiary Towchester Investment Co Ltd had been informed by Ethiopia's Ministry of Mines that it has decided against issuing any mining licences for alluvial mining along those parts of the Abay River and its tributaries that will be flooded by the Grand Ethiopian Renaissance Dam.

The rationale for this decision is that the success of the new dam and its intended transformation of the Ethiopian economy is so much in the Ethiopian national interest that the risk of any negative impacts arising from any mining activities outweigh the potential economic gains from gold royalties and taxes during the period that those activities might take place before flooding.

At a meeting attended by Nyota's CEO, a second Nyota Director, Towchester's General Manager and its Ethiopian partner for the mine development, the Minister for the Ministry of Mines stated that the decision was in no way a reflection of the application or the applicant and that Nyota would continue to receive support if it wished to identify new areas of interest and specifically those that are sparsely populated.

Towchester submitted its application for a mining licence in April 2014 having received a positive response from the Ministry to the concept.

Although there were longer than expected delays, after the September meeting at which revisions were agreed and subsequently formally submitted to meet the Ministry's requirements, the final decision comes as a surprise.

Nyota has however considered its position and in the light of the rationale it has been given, the Board has decided that an appeal, which is allowed for under the relevant legislation, would be a non-productive use of resources given the negligible chance of success.

The recent renewal of the Brantham and Towchester exploration licences (collectively "the Northern Block") announced on 11 December 2014 is unaffected and Nyota had paid its annual fees prior to this latest decision in order to continue its exploration.

However, as disclosed at the time, the size of these licences was impacted by the imposition of an exclusion zone around the area to be flooded by the dam. This resulted in the Towchester exploration licence renewal area being further significantly reduced by the Ministry of Mines from 458 square kilometres to 48 square kilometres (excluding the now rejected alluvial mining application area of 48km2) and the Brantham licence area from 1,002 square kilometres to 717 square kilometres.

Details of the exclusion zone have not been published and the Ministry of Mines gave no indication that it would affect their support for the mining licence application for mechanised alluvial mining within it; the very purpose of which was to extract as much of the gold resource as possible prior to flooding and the term of the licence and the implementation of mining were specifically agreed to dovetail with the Government's preparations for that event.

It was also an unequivocal component of the alluvial mining licence application that revenue from mining be used to fund exploration in Ethiopia for hardrock mineralisation. This, it was proposed, would have been further supported by selling all gold production to the National Bank of Ethiopia with 30% of the proceeds to be paid in Birr (and the rest in US Dollars) and a community development fund established for affected peoples.

Nyota will be conducting a strategic review of activities and opportunities in Ethiopia but will make future decisions in the light of the Minister's comment on resettlement, the competitiveness of the investment climate and the timing and manner in which applications are being dealt with.

* * *

Gem Diamonds [LON:GEMD] reports a continued strong performance at Letšeng while Ghaghoo mine development is progressing well with encouraging initial diamond recoveries.

And the company says it is on track to declare a maiden dividend to shareholders following the 2014 full year results.


· 25 525 carats were recovered in Q4 2014 (28 365 carats in Q3 2014).

· The year ended very positively, with the December tender achieving an average of US$ 2 799* per carat. This resulted in an average value of US$ 2140* per carat being achieved in Q4 2014 (US$ 2603* per carat in Q3 2014), bringing the average for 2014 to US$ 2 540* per carat (US$ 2043* per carat for FY 2013).

· 13 rough diamonds achieved a value of greater than US$ 1.0 million each during the Period, including a 112.6 carat white diamond and a 90.4 carat white diamond which sold for US$ 5.8 million and US$ 4.2 million, respectively.

· A 299.3 carat yellow diamond was recovered and extracted at rough valuation during the Period. It was sold into a partnership arrangement in January 2015 with Letšeng to share in 50% of the polished uplift.

* Includes carats extracted at rough valuation for polishing.


· A total of 10 167 carats were recovered during commissioning up to Period end, including a 20 carat white diamond, a 17 carat white diamond, and a 3 carat orange diamond which confirms the presence of valuable coloured diamonds in the orebody.

· A 35 carat diamond was recovered in January 2015, the largest diamond recovered at Ghaghoo to date.

· An initial sale of c.10 000 carats will be held in Gaborone and Antwerp during January and February 2015.

· The development of Phase 1 is progressing well and the ingress of water has been arrested and steps taken to prevent any further interruption to production from water intersections.

Chief executive Clifford Elphick said: "The fourth quarter of 2014 saw an encouraging end to a very positive year for Gem Diamonds, with the December Letšeng tender achieving an average of US$ 2 799 per carat. At Letšeng, a year of solid operational performance saw an improvement over the prior year's production results, with costs well controlled. Both the implementation of the Plant 2 Phase 1 upgrade and the new Coarse Recovery Plant projects remain on track for commissioning in Q1 and Q2 of 2015 respectively - on time and budget.

"At Ghaghoo the development of Phase 1 has progressed well and significant work was undertaken to arrest the fissure water intersected in the basalt country rock and to ensure that any further water ingress is handled efficiently. The production ramp-up has begun and the first sale of diamonds recovered from commissioning will take place in February. There have been some encouraging recoveries made of larger and coloured diamonds during this commissioning period.

"The long term outlook for the diamond market remains strong, however during the fourth quarter the diamond market saw a weakening of prices following a year of price growth. This trend may continue into the first quarter of 2015.

"Based on the positive results achieved in 2014, Gem Diamonds remains on track to declare a maiden dividend to shareholders following the 2014 full year results announcement in March 2015."

* * *

Kibo Mining [LON:KIBO] has received an independent geochemical interpretation report for the Haneti project in central Tanzania which confirms the Mihanza area as a robust drill target.

The report says the Mihanza Hill prospec soil anomaly proves to be consistent with that expected for a significant Ni-Cu-PGE sulphide deposit.

Other highlights: · Key parameters of anomaly indicate a signature with the potential to represent a significant magmatic Ni-Cu sulphide source

· Characteristics of Mihanza Ni-Cu anomaly suggests a possible "chonolith" intrusion which dramatically improves the probability of exploration success

· Mihanza results validates and independently confirms the Ni- Cu- PGM potential of the Haneti project

The work was carried out by consultant geochemist Dr. Nigel Brand of Geoservices Pty Ltd of Perth Western Australia who has global experience interpreting geochemical data over nickel sulphide style mineralisation targets particularly in Australia and East Africa.

Kibo Mining chief executive Louis Coetzee said: "With this new report to hand the case for further exploration and development at Haneti is compelling. We are delighted that the geochemical work undertaken has highlighted the nickel sulphide potential at Haneti and ratified historic exploration work and our own findings as previously announced.

"Various additional work is underway to review the entire dataset from Haneti with a view to further improving our understanding. We are now confidently moving forward to enable rapid visible progress at Haneti, for the benefit of the company and our shareholders. Further updates will follow."

* * *

Oxus Gold [LON:OXS] has issued 84,746 new ordinary shares to SP Angel Corporate Finance LLP, the company's nominated adviser and broker, in lieu of certain fees due for the period from 1 January to 31 March. The new ordinary shares were issued to SP Angel at the mid-market closing price on 31 December, being 2.95p.

* * *

Highland Gold Mining's [LON:HGM] total production at Mnogovershinnoye (MNV), Novoshirokinskoye (Novo), and Belaya Gora reached 258,937 oz of gold and gold equivalents in 2014 - 10.8% up on the previous year.

Total production for 2015 (MNV, Novo and Belaya Gora) is expected to increase to 270,000-285,000 oz of gold and gold equivalents.

* * *

Anglo Pacific Group [LON:APF] has issued an update on its 1% gross revenue royalty (GRR) over the Isua project in Greenland.

On 8 January 8, the government of Greenland announced that it had approved the transfer of all shares of London Mining Greenland (Jersey) (1) Ltd to General Nice Development Limited.

The Isua project licence is owned by London Mining Greenland A/S, a wholly owned subsidiary of London Mining Greenland. Yesterday, Anglo Pacific received official confirmation of this from PricewaterhouseCoopers LLP, the administrator of London Mining PLC.

Anglo Pacific intends to waive its rights to the repayment of the US$30m advanced to London Mining in 2011 under the change of control provisions of the royalty financing agreement due to the inability of London Mining to make this repayment.

The indirect transfer of the licence means that the company structure of London Mining Greenland A/S remains the same and the royalty will continue to apply to the project.

Chief executive Julian Treger said: "We are encouraged by this development as we believe Isua remains a viable project in the longer term. We look forward to the progression of the Isua project in the short to medium term under the ownership of General Nice who the Government of Greenland has assessed as being able to raise the necessary financing for the development of the exploitation licence, and we anticipate building a strong and mutually beneficial relationship between our companies."

* * *

The Kibali gold mine is now well advanced into the second and final phase which will take it to full production by 2018, Randgold Resources [LON:RRS] chief executive Mark Bristow told a media briefing in Kinshasa today.

Randgold is developing and operating the mine, which it owns in partnership with AngloGold Ashanti and the Congolese parastatal SOKIMO.

Bristow said with the final commissioning of the metallurgical plant and the first of three hydropower plants, Kibali was now operating at design with the ramp up having delivered against plan.

The priorities for the current year were to advance the development of the underground mine, which will complement the existing open-pit operations, ramp up annual production to 600 000 ounces, commission the second hydropower plant and start work on the third, and continue expanding and upgrading the local skills base.

He noted that the past year had also seen the finalisation of the resettlement programme, including the completion of the Catholic Church complex in the new model town of Kokiza, the expansion of the local road network to 350 kilometres, and Randgold's ongoing support for the development of a robust local economy.

Since the start of the project, Randgold has awarded business valued at more than $650 million to Congolese-owned companies while its engagement with local co-operatives has created more than 400 non-mining jobs.

* * *

Coal of Africa Limited [LON:CZA] has announced that the South African Department of Environmental Affairs has recently granted an amendment of the environmental authorisation in terms of the National Environmental Management Act (Act 107 of 1998) and the Environmental Impact Assessment Regulations (2010) for Vele Colliery.

This amendment is the first of several required to be granted in relation to the planned modifications to Vele's processing plant, and is a further step toward achieving full regulatory compliance required to begin construction.

Chief executive David Brown said: "The decision by the DEA is welcomed. We will await the receipt of all regulatory approvals before the commencement of the plant modification."

The company has also sought a renewal of the Integrated Water Use Licence and its amendment. The current IWUL expires in March 2016, and the company felt it was prudent to renew this licence prior to committing further shareholder funds to the project. The approval of the renewal is expected at the end of Q2 CY 2015.

Brown said: "We will continue to engage with regulatory authorities and other stakeholders at Vele, as we continue to set a new benchmark for the co-existence between mining, agriculture and heritage land uses within the area in which we operate. This period also gives the company further time to assess the outlook for coal prices. Discussions continue with appropriate end users regarding off take agreements."

At 3:59pm:

[LON:AQP] Aquarius Platinum Ltd share price was +0.13p at 14.63p

[LON:BEM] Beowulf Mining PLC share price was +0.01p at 1.38p

[LON:BKY] Berkeley Resources Ltd share price was 0p at 13.75p

[LON:CEY] Centamin PLC share price was +3.53p at 69.33p

[LON:CHL] Churchill Mining PLC share price was -0.5p at 13p

[LON:CZA] Coal of Africa Ltd share price was -0.03p at 1.7p

[LON:FDI] Firestone Diamonds PLC share price was +0.01p at 34.88p

[LON:FRES] Fresnillo PLC share price was +11.5p at 908p

[LON:GEMD] Gem Diamonds Ltd share price was -16.75p at 152.25p

[LON:HGM] Highland Gold Mining Ltd share price was +1p at 42.5p

[LON:HOC] Hochschild Mining PLC share price was -2.37p at 97.13p

[LON:KIBO] Kibo Mining share price was -0.5p at 6.25p

[LON:KMR] Kenmare Resources PLC share price was +0.08p at 3.18p

[LON:NYO] Nyota Minerals Ltd share price was -0.02p at 0.07p

[LON:OXS] Oxus Gold PLC share price was -0.05p at 2.37p

[LON:VED] Vedanta Resources PLC share price was +19p at 410.1p

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