Vaaldiam Mining Inc, which owns a 51% stake in the Brauna diamond project in Brazil's Bahia state as well as the Duas Barras and Chapada diamond mines and interests in gold projects, has reported a net loss of $7.64 million for the first quarter of 2011.



The company ended the period with a cash position of $5.6 million and working capital of $3.7 million.



On March 4, 2011, Vaaldiam entered into an arrangement with the joint venture partners of the Brauna project to restructure the existing arrangement and to increase the ownership interest of the company in the Brauna project from 20% to 51% by paying a transaction consideration of $6.5 million over 15 months. In April, the company reported that diamonds from the Brauna project had been valued at $338/carat.



That same month, Vaaldiam decided to suspend operations at Duas Barras following a significant drop in the project's ore grade – resulting in a loss of $6.1 million. Production at Duas Barras is expected to remain shut down until rising diamond prices make the mine economically profitable.