Greenland miner says finds diamonds in "Nest" area

COPENHAGEN - Greenland mining company NunaMinerals said on Wednesday it had found diamonds in an area called "The Nest" and would pursue work this year to determine the potential volume, lifting its shares sharply.

NunaMinerals said that it had earlier identified considerable quantities of kimberlitic rock, known as "float", at its Qaamasoq prospect in western Greenland and has now been able to establish that the site contains diamonds.

"This promising mineral chemistry and the confirmation of the presence of diamonds shows that we are on the right track for assessing the potential for an economic deposit of diamonds," Chief Executive Ole Christiansen said in a statement.

Shares in NunaMinerals leapt nearly 26 per cent to a seven-month high of 180 crowns (S$40.72) by 1202 GMT (8:02 local time), on a soft Copenhagen bourse where the bluechip index was off 0.2 per cent.

"In 2012 NunaMinerals plans to follow up these encouraging reconnaissance results," the Copenhagen-listed company said.

The float occurs in a number of high-concentration sites, notably an area of 550 metres by 250 metres named "The Nest", or"Ullu" in Greenlandic, NunaMinerals said.

Although the dimensions of the source or sources are not known, the mineralogy is similar to that of the nearby Garnet Lake diamond deposit in West Greenland, NunaMinerals said.

NunaMinerals, which sold its stake in a Greenland gold mine to Crew Gold Corp in 2007, has a portfolio of exploration projects at various stages of development.