(Sharecast News) - Karelian Diamond Resources said in an update on Wednesday that it is entitled to land possession over the entire mining concession area for the Lahtojoki diamond deposit, after the payment of compensation to landowners as decided by the National Land Survey of Finland.
The AIM-traded firm said the concession over the Lahtojoki deposit had already been approved by TUKES, the Finnish mining authority.
It said the National Land Survey carried out proceedings to establish the mining concession for the applied area, involving two public meetings over ground rental compensation for local landowners.
The total compensation agreed was €0.16m, paid from existing cash resources within the required three-month period from 28 December.
However, the owners of two landholdings had appealed the amount of compensation, with one boundary outline also being appealed.
That, Karelian said, would delay the formal registration of the mining concession until the boundary appeal was finalised.
It did, however, say that would not affect the company's entitlement to land possession over the entire mining concession area, adding that it could proceed with initial work on the mining concession area.
The Lahtojoki diamond mining project consists of a mining concession covering 71 hectares, including a kimberlite pipe with a surface area of 16 hectares.
Karelian said the deposit was known for containing high-quality colourless gem diamonds, as well as coloured diamonds, including pink diamonds that could command prices up to 20 times that of normal coloured diamonds.
"I am very pleased that the compensation to landowners, as determined by the National Survey of Finland, has been paid and that there have only been two appeals against the amounts determined, together with one boundary appeal," said chairman Richard Conroy.
"This is a further step forward in the company's plan to bring in a diamond mine in Finland."
At 1038 BST, shares in Karelian Diamond Resources were down 7.65% at 1.62p.
Reporting by Josh White for Sharecast.com.
Karelian (KDR)