Australian diamond explorer POZ Minerals (ASX:POZ) will officially throw its hat in the ring for ownership of the Ellendale diamond mine in Western Australia.

POZ responded to the Western Australia State Government’s call for expressions of interest from parties looking to develop the Ellendale project.

Located in the Kimberley region of Western Australia, Ellendale is well known for its high-quality colored diamonds, and at one time was a supplier for international jeweller Tiffany’s (NYSE:TIF). The site was in production between 2002 and 2015, when a number of fancy yellow diamonds were recovered.

The acquisition would be especially advantageous for POZ as the company’s Blina diamond project currently surrounds the Ellendale site. According to the company announcement, “the joining of these two diamond projects under common ownership would create significant commercial advantages and synergies.”

While there is no official word on who the other bidders are, POZ does hold a favorable position. The gem miner has its ongoing project adjacent to the site, where it has negotiated a mining agreement with the local Bunuba Traditional Owners and secured the needed mining leases.

POZ believes its track record with Blina will reflect positively during the company’s pursuit of Ellendale.

“The acquisition of the Ellendale diamond mine lease would provide an excellent commercial opportunity for POZ to consolidate control over the entire Ellendale and Blina diamond fields,” stated the press release.

“This would result in economies of scale and efficiencies in exploration and development and would be a major step towards building a branded diamond mining company producing the fancy yellows for which Blina and Ellendale are justifiably famous.”

The Western Australia project is comprised of diamondiferous lamproite pipes and associated diamondiferous alluvial gravels. To date, only two pipes, Ellendale 4 and Ellendale 9 have been mined, with a total production of 424,000 carats.

An additional diamondiferous pipe, the E4 satellite pipe, has yet to be mined.

In mid-September company directors, Jim Richards and Grant Mooney, will join government officials and other potential bidders for a site tour of Ellendale. The two-day trip will assess the potential of the site, as well as identify areas for further exploration.

The state government is expected to make its final decision and announce the winner in early 2019.

POZ shares were slightly down on Tuesday (September 4), trading at AU$0.073.

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Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.