SHARES IN African Diamonds rose by 3.4 per cent in London yesterday after the Clontarf-based company announced a potential increase in the value of its joint venture AK6 diamond mine in Botswana.

The Irish company said the latest valuation of the diamonds at the mine was $162 (€119 ) a carat, $23 a carat higher than that used in its current studies.

The valuation also indicated the possibility of a $200-a-carat value at production. African Diamonds said the project is on target for a late 2011 start-up.

In addition, the Irish company said no attempt has been made to value the impact of the “large Type IIA diamonds, which were recovered in a broken state in the exploration drill diamond samples”.

It said changes are being made to the processing plant to minimise diamond breakage to allow the recovery of diamonds up to 350 carats in size.

The plant is being refigured to increase start-up capacity from two million tonnes of ore a year up to three million tonnes annually.

A valuation of 1,760 carats of diamonds from AK6 was undertaken in Geneva by Mercury Diamonds.

In its valuation, Mercury noted that: “Overall the diamonds from AK6 are deemed to be of very good quality and very attractive to diamond buyers. Colours are generally very white, and the samples showed numerous examples of ‘blocky’ makeable and strong crystal forms that tend to lead to strong polished yields and demand a premium.”

African Diamonds has a near 30 per cent stake in AK6.

The balance is held by Lucara, a Canadian listed company that recently took over a stake held by De Beers.