Golden Saint Resources (LON:GSR) says it has taken a step closer to becoming a cash generative company following the granting of a diamond exporter’s licence by the authorities in Sierra Leone.

This allows the group to buy stones from artisanal and small-scale miners on its Tongo, Moa and Baja licences as well as surrounding areas. The plan is then to send them for cutting in Australia before they are put on sale.

It has a memorandum of understanding (MOU) with Solid Gold Jewellers in Perth, which will affect the transformation from rough diamond to finished product – a process that adds huge value to the stones.

"With the MOU in place and the ability to conduct alluvial mining on our exploration licence areas the company will soon be in a position to ship out alluvial diamonds from Sierra Leone on a regular basis, which will augur well for the cash flow of the company,” said chairman Cyril D' Silva.

"I look forward to being able to advise on potential shipment of diamonds in the coming weeks."

Listed at 10p in July, the stock was changing hands for 11.9p on Friday for a gain of just over 2%.