The company said Bluedust will develop the Oena alluvial diamond mine using Bourevestinik X-ray machines (BVX) and/or pan plants.
Bluedust, at its own cost and expense, will provide and maintain all the plant and equipment as required to perform the mining services.
The diamonds produced by Bluedust at Oena will be sold via a designated tender facility in South Africa, and 75% of the gross income of net diamond sales, less commission, will be paid to Bluedust for the duration of the 60-month contract.
Individual stones recovered with a gross selling price, less commission, of greater than R6.78 million will see Bluedust being paid 70% of the gross income.
Bluedust specialises in the processing of alluvial diamond deposits in South Africa.
Oena consists of an 8 800-hectare mining right and corresponding infrastructure and all associated processing equipment located along the Orange River in a well-established alluvial diamond mining province known to produce high-quality and large-sized diamonds.
The agreement is subject to due diligence by Bluedust, which must be completed by December 31, 2017.
During this period, Bluedust will conduct a site investigation to determine the minability and diamond-bearing potential of the gravels at Oena. This could include trial mining using BVX and other equipment as necessary.
The agreement does not affect Tango’s existing agreement with Consulmet to operate the equipment of TML Equipment Solutions.
The five year agreement is subject to due diligence by Bluedust, which must be completed by 31 December 2017.