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Shefa Yamim has a highly commercial suite of gemstones at Kishon River

Shefa Yamim has a highly prospective gemstone project in Israel
Shefa Yamim has a highly commercial suite of gemstones at Kishon River
The Kishon River

The central proposition of Shefa Yamim ATM LTD (LON:SEFA) is simple enough. The company has what non-executive director James Campbell describes as a large secondary gemstone deposit in the Kishon Valley in Israel.

One of the sources of the gemstones is the nearby Mount Carmel, but that’s another story, since the geological model there has not yet been fully worked out. What matters as far as Shefa is concerned is that the terraces next to and inland from the Kishon River are rich in gemstones, particularly moissanite and sapphire, and with the occasional diamond too.

READ: Shefa Yamim appoints new consultant to evaluate Kishon Mid-Reach

Campbell himself is a diamond specialist, having worked at De Beers as Nicky Oppenheimer’s PA, and subsequently as the director of several diamond companies including Rockwell Diamonds, African Diamonds, and Botswana Diamonds, which he is currently heading up.

He understands the geology of the Kishon Valley well enough, but more importantly he knows how to take this story to market, and how to develop the project towards production.

“The first thing we need to define,” he says, “is how many cubic metres of ore there is, how many tonnes. The second is how abundant the gemstones are in that ore.”

There’s already a significant amount of knowledge to work off. The company has termed the known mineralised area on its 600 square kilometres of ground as a “Gem box” because it contains such a broad suite of gemstones.

Fourteen samples taken in the Kishon Mid Reach Zone 1 during the first half of 2018 produced 9,778 carats from 6,384 tonnes of gravel.

“Diamonds are only a rare occurrence,” says Campbell. “They’re of no commercial significance. The commercial significance is in all the associated minerals.”

Specifically, these are spinel, Carmel SapphireTM, moissanite, ruby, hibonite, garnet, ilmenite, zircon and rutile. The latter three are standard mineral sands, saleable on commercial markets globally, while the others are higher value stones.

“The most abundant is the sapphire,” says Campbell. “And then the moissanite. There are no operations producing natural moissanite anywhere in the world. It’s often confused with diamond, but it has a brighter lustre.

WATCH: Shefa Yamim appoints team to help build economic profile of Kishon Mid-Reach

The preliminary capital and operating costs of setting up a mine on  Shefa’s permits is about to be determined in a study that’s being undertaken by consultants Paradigm Project Management, a company that Campbell has worked with before.

PPM is putting together what Campbell calls “a technical and economic assessment” on the project. This should be ready by the end of August, and once the results have been assessed by the company and an inferred resource put in place, trial mining should follow in 2019. Commercial production is currently anticipated in 2020.

As it stands, Shefa’s operation is never likely to be huge. Mining old alluvials is never as lucrative as hitting the source, but what counts here is the commerciality.

Production of gemstones, and in particular the company’s trademark brand of “Carmel Sapphires”, is likely to deliver substantial margins, particularly when the provenance of the Holy Land is brought into the marketing equation.

 

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