According to a recently completed scoping study, there is enough ore at Argyle to support a huge 8 million tonnes per year block cave underground mine for 11 years, pushing the operation's life out to 2018.
Rio and Ashton partners are currently involved in a $290 million expansion of the Argyle open cut - the world's biggest diamond mine - to extend the life until 2007.
Beyond that date the joint venturers will need to complete another massive pit cutback or - more likely - head underground to access the deeper ore.
Ashton said in its latest quarterly report that an order of magnitude study for the underground option envisages a block caving operation encompassing a resource of around 80Mt.
"A recommendation to conduct a feasibility study will be proposed soon," the company said.
"The study is expected to be completed by early 2001, however it is several years before a final development decision would be required."
Block caving is a bulk underground mining method. At 8Mt per year, Argyle would become the biggest block cave in Australia, easily surpassing North Ltd's Northparkes copper/gold operation in New South Wales.
"It's a big mine," said Glenister Lamont, Ashton's general manager, corporate.
"A capital cost estimate of $350 million is probably in the ballpark," he said.
"Rio at this stage haven't taken the deeper levels into consideration. They have factored in two lifts, with ore production of roughly 7-8Mtpa. That's what they have blocked out to start off with."
Lamont said the partners won't be looking for an immediate development go-ahead after the feasibility study finishes next year.
"We need to ask, 'Is it technically and economically feasible?' If the answer is yes, we don't need to make a decision for two or three years at the earliest," he said.
Argyle's AK1 orebody grades around 3 carats per tonne. Assuming this grade remains constant in the deeper parts, the envisaged underground operation would produce 24 million carats per year
.
Argyle produced nearly 30 million carats in 1999 and expected production this year is 26 million carats.
MORE: Argyle continues to sparkle
