The drilling program, commenced in April, has been targeting the depth extensions of five kimberlite pipes in the southern cluster. It has shown that two of the main pipes widen at depth to form one much larger pipe, about 120m below the natural surface.

“The aim of the program was to provide pipe dimension and geotechnical data for underground mine planning and study purposes,” Ashton said.

“In the short term, optimisation will determine whether an expanded open pit is feasible. In the medium term, the larger pipe footprint will require re-analysis of the underground potential and mining options.”

Ashton chief executive Doug Bailey said the results highlight the value of the company’s non-Argyle assets.

Ashton is the junior partner with Rio Tinto in the Argyle diamond mine in Western Australia’s Kimberley region.

South African diamond cartel De Beers made a $1.62 a share hostile takeover bid for the Australian miner at the end of July – a bid which Ashton’s management reacted to angrily, labelling it opportunistic and inadequate.

Rio subsequently made a friendly offer of $1.85/share with a scrip alternative.