Friday 21st October 2016

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Posts tagged ‘Shore Gold Inc (SGF)’

Looking to Lac de Gras

August 27th, 2015

World diamond production drops but Canadians compete to make up the shortfall

by Greg Klein

An almost 4% increase in global diamond production by value last year coincided with an almost 4% drop in volume. Numbers released August 25 by the Kimberley Process Certification Scheme indicate higher prices kept revenue growing despite lower output. But, should December’s optimistic forecasts hold, demand will call for new sources. Among the most promising locations is Canada, which the Kimberley Process says held its third place spot for global production by value even as Russia pushed Botswana into second place. In fact Canada owes its status to just one region of the Northwest Territories, Lac de Gras, which hosts three current mines, a soon-to-be fourth and an encouraging exploration play.

The region’s most recent entry is Zimtu Capital TSXV:ZC, which on August 25 announced exploration had begun on the Munn Lake project held by the company and a staking partner. Despite about $5.7 million of work between 1996 and 2007 that found two diamondiferous kimberlites, the 14,000-hectare property has yet to undergo modern exploration.

World diamond production drops but Canadians compete to make up the shortfall

Of four kimberlites under its focus, Kennady Diamonds plans a
2015 maiden resource for Kelvin, further infill drilling for Faraday
1 and 2, and exploration at MZ.

Yet a previous 581-kilogram sample from the project’s Yuryi kimberlite showed 226 diamonds, among them 62 macro-diamonds above 0.5 millimetres in diameter. A 42-kilo sample from the Munn Lake kimberlite yielded two macros and 12 micro-diamonds. Over 2,500 samples revealed at least five distinct kimberlite indicator mineral (KIM) trains lining the property.

Zimtu now has a crew sampling KIMs to validate historic sampling and “provide additional insight into the diamondiferous potential of each area.”

Earlier this month Arctic Star Exploration TSXV:ADD announced plans to explore its 54,000-hectare T-Rex property in Lac de Gras. Historic work found over a dozen kimberlites, most of them diamondiferous, the company stated. Historic, non-43-101 results of a 436-kilo bulk sample from the Jack Pine kimberlite reported 572 micro-diamonds.

Another 299 micro-diamonds turned up in 360 kilos of Jack Pine kimberlite drilled in 2005, according to 43-101-compliant results.

Last June Arctic Star reported an update from North Arrow Minerals TSXV:NAR on Redemption, their Lac de Gras joint venture. Initial interpretation of ground geophysics indicates a number of targets for a potential 2016 winter drill program, Arctic Star stated. Its partner also has the property’s surficial geology under analysis to better define and interpret the region’s South Coppermine KIM train.

With about 97,220 hectares of Lac de Gras turf, Canterra Minerals TSXV:CTM said in June it’s identified several areas “that warrant further detailed exploration, including drilling,” along with other areas that could undergo till sampling and geophysics.

Last month Margaret Lake Diamonds TSXV:DIA announced an agreement, subject to TSXV approval, to acquire the remaining 40% interest in the Margaret Lake property, giving the company sole ownership. The company anticipates a winter drill program to test targets identified by last year’s airborne gravity survey. The 19,716-hectare property lies contiguous to the north and west of Kennady Diamonds’ (TSXV:KDI) Kennady North project, the region’s most advanced project other than the Gahcho Kué mine-to-be, which Kennady surrounds on three sides.

With four kimberlites under assessment at the 61,000-hectare property, Kennady reported results of a 443-tonne bulk sample from the Kelvin pipe on August 26. Of 16,247 diamonds recovered from four zones of Kelvin’s “more diluted” southeast lobe, 35 weighed over one carat. The zones averaged 2.02 carats per tonne for diamonds larger than 0.85 millimetres.

The lab described the five largest as follows:

  • 4.22-carat white/colourless, transparent macle with no inclusions

  • 3.95-carat brown, transparent aggregate with inclusions

  • 2.79-carat light brown, transparent aggregate with minor inclusions

  • 2.63-carat white/colourless, transparent octahedral with inclusions

  • 2.59-carat white/colourless, transparent dodecahedron with no inclusions

The project’s winter agenda calls for another bulk sample from Kelvin’s north lobe, where a 19-tonne mini-bulk sample last year averaged 2.59 carats per tonne. Kennady has Kelvin slated for a maiden resource by year-end. The company also has exploration drilling underway at the project’s MZ kimberlite and further infill drilling planned for the Faraday 1 and 2 pipes.

Kennady closed a $4-million private placement earlier this month.


In operation or under development: Canada’s diamond mines

Canada’s in the forefront of countries trying to make up the diamond supply shortfall, with new mines coming online as others face depletion. Besides the NWT’s three operations and De Beers’ Victor mine in Ontario, two others are in development.

Of the three Lac de Gras mines, Dominion Diamond’s (TSX:DDC) majority-held Ekati has about five years left to its life expectancy, although development of the Jay deposit could potentially add another 11 years.

Diavik, a Rio Tinto NYE:RIO/Dominion 60/40 JV, would last to 2023 with the addition of a fourth pipe.

De Beers’ Snap Lake could last to 2028, although with declining output. In March the global giant said an amended water licence might be necessary to avert a much earlier shutdown. In June the Mackenzie Valley Land and Water Board recommended the NWT government approve the application.

Ontario’s only diamond mine, De Beers’ Victor, faces depletion in 2018. The company hopes to postpone its doom by developing the Tango kimberlite, a smaller, lower-grade deposit seven kilometres northwest.

World diamond production drops but Canadians compete to make up the shortfall

On schedule for H2 2016 production, Gahcho Kué would
become “the world’s largest and richest new diamond mine,”
according to Mountain Province.

Now building Quebec’s first diamond mine, Stornoway Diamond TSX:SWY has operations scheduled to begin at Renard late next year and commercial production slated for Q2 2017. Although potential resource expansion continues, the company estimates Renard would supply 1.6 million carats annually for 11 years, providing about 2% of global supply.

A fourth Lac de Gras operation, destined to become “the world’s largest and richest new diamond mine,” remains on track for H2 2016 production. Mountain Province Diamonds TSX:MPV and joint venture partner De Beers expect Gahcho Kué to produce an annual average 4.5 million carats over a dozen years.

In Saskatchewan’s Fort à la Corne region, Shore Gold’s (TSX:SGF) majority-held Star-Orion South underwent a spring drill program to update the Orion South kimberlite’s resource. Although the project reached feasibility in 2011 and passed a federal environmental review in December, Shore now plans a revised feasibility to reduce capex.

In addition to regions around existing and future mines, Nunavut and Saskatchewan’s Pikoo region also draw significant diamond exploration.

Disclaimer: Zimtu Capital Corp is a client of OnPage Media Corp, the publisher of The principals of OnPage Media may hold shares in Zimtu Capital.

The drama of discovery

July 17th, 2015

Not without excitement, the quest continues for Canadian diamonds

by Greg Klein

Calling it an “exceptionally rare” occurrence, Kennady Diamonds TSXV:KDI geologists spotted a macro diamond while logging drill core from the Faraday 2 kimberlite on July 15. It was the second such find in a year for the Kennady North project and probably rendered less than momentous by foreknowledge that the pipe did in fact contain diamonds. Even so, the event brings to mind a dramatic moment in Canadian diamond history.

The scene also took place in the Northwest Territories’ Lac de Gras region, but during late winter 1994. As recounted in Matthew Hart’s Diamond: The History of a Cold-Blooded Love Affair, 24-year-old Eira Thomas ran the project for Aber Resources while her father, Gren Thomas, conducted merger negotiations down south. Eira feared the deal would close at a disadvantage to Aber despite lab recovery of micro diamonds from the property’s A-21 kimberlite.

Not without excitement, the quest continues for Canadian diamonds

Standing up to disagreement from a partner as big as Rio Tinto NYE:RIO, the young geo thought she was on the brink of a more substantial discovery with the A-154 target. Even as lake ice began thawing, Thomas not only persuaded the crew to continue barge-based drilling but cajoled them into working a heavier, larger-diameter rig. Just as weakening ice finally forced the drillers to quit, Aber geologist Robin Hopkins found kimberlite studded with indicator minerals. Summoned by phone calls, Aber and Rio staff descended on the camp.

As they gathered in the core tent, Hopkins spotted something protruding from a piece of core. Hart writes:

Hopkins tried to scratch the crystal with his thumbnail, and couldn’t. When he looked up, he saw that Thomas was raptly watching him. “No way,” he breathed. He passed the core with the crystal embedded in it to Buddy Doyle of Rio Tinto. Doyle stared at it. “No fucking way,” he said, and handed it on to Thomas. She took the core in her hands and gazed at it, a two-carat diamond bouncing light from its crystal face.

That dramatic moment presaged Diavik, Canada’s second diamond mine and successor to Ekati, itself the result of Chuck Fipke’s adventurous spirit as well as geological acumen. Now, with three Lac de Gras mines in operation, the NWT ranks third globally for diamond production by value.

Yet the lifespan of Ekati, majority-owned by Dominion Diamond TSX:DDC, ends in 2020. The mine’s Jay deposit could potentially extend the expiry date to 2031, according to the company. Diavik, held 60/40 by Rio and Dominion, would last to 2023, even with the addition of a fourth pipe, the A-21 that Thomas discovered before A-154.

Snap Lake, De Beers’ first mine outside Africa, could continue operating until 2028, albeit with declining output. Earlier this year the company warned a much earlier shutdown might occur if an amended water licence wasn’t approved. Last month the Mackenzie Valley Land and Water Board recommended the territorial government grant approval for a plan to flush a higher proportion of dissolved solids into water that’s discharged into the lake.

De Beers also produces Canadian diamonds at its Victor mine in Ontario’s James Bay lowlands. The discovery actually dates back to 1987, about five years before Fipke’s historic find. But the Ontario mine didn’t open until 2008.

As those four mines mature, Stornoway Diamond TSX:SWY plans to pick up some of the slack with its Renard project in Quebec’s James Bay region. With commercial production slated for Q2 2017, Renard would give up 1.6 million carats annually for 11 years, about 2% of global supply, the company estimates.

Back at Lac de Gras, the world’s richest diamond development project continues to progress. Last week Mountain Province Diamonds TSX:MPV announced construction at Gahcho Kué was 62% complete and on schedule for H2 2016 operation. Also headed by Kennady president/CEO Patrick Evans, Mountain Province holds a 49% stake in the project, which is operated by JV partner De Beers. It’s expected to produce an average 4.5 million carats a year over a 12-year life.

Not surprisingly, Lac de Gras hosts a busy exploration play. Gahcho Kué’s next-door neighbour Kennady North remains the most advanced. On July 15, the same day the Faraday 2 stone lit up Kennady’s core shack, the company reported lab recovery results from Faraday 2’s spring drill program. About 930 kilograms of kimberlite returned a sample grade of 1.93 carats per tonne for diamonds of commercial size.

Of 247 individual diamonds described by the lab, 37% were transparent and white/colourless, while 56% were off-white. With 97% of the sample showing transparent white or off-white gems, the results could “have a positive impact on diamond values,” Evans stated.

The company expects recovery results from Kelvin’s 436-tonne bulk sample by the end of Q3. Results from a 2.6-tonne sample of Kelvin South Lobe kimberlite should arrive in early September.

Saskatchewan, meanwhile, hosts a more advanced diamond project in Shore Gold’s (TSX:SGF) majority-held Star-Orion South. Although it passed a federal environmental review in December, the company now seeks to cut pre-production capex through a revised mine plan and feasibility study.

Kennady finds macro diamond while logging Faraday 2 kimberlite core

July 16th, 2015

This story has been moved here.

Replenishing reserves

December 11th, 2014

With a decade of diamond demand outgrowing supply, Canada’s a target for new sources

by Greg Klein

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Diamonds: Global supply and demand

Miners of other commodities might welcome half of the diamond dilemma. Forecasts see continued market growth for another decade. But production will taper off. That’s the 10-year prognosis from Bain & Company and the Antwerp World Diamond Centre. Meanwhile another report from the NWT and Nunavut Chamber of Mines addresses the need to maintain production in the Northwest Territories, the world’s third-largest source of diamonds by value and home to a busy exploration scene.

The December 9 Bain study, which generally agrees with a September report from De Beers, expects an average 4% to 5% compound annual growth in rough diamond demand to 2024 driven largely by India, the U.S. and especially China. Supply growth, on the other hand, should lag behind at 3.5% to 4% up to 2019, then fall to somewhere between 1.5% and 2% for another five years.

With a decade of diamond demand outgrowing supply, Canada’s a target for new sources

The world’s largest source of new production would be Gahcho Kué, the De Beers/Mountain Province Diamonds TSX:MPV joint venture slated for 2016 production in the NWT’s Lac de Gras region. The mine’s expected to produce between five and six million carats annually to 2020.

Bain forecasts Lukoil’s Grib mine in Russia at four to 4.5 million carats a year when it begins operation in 2016. After that would come the Karpinsky-1 pipe at ALROSA’s Lomonosov project in Russia, expected to yield about three million carats annually after reaching commercial production in 2015. Stornoway Diamond’s (TSX:SWY) Renard project in Quebec, slated for 2016 commercial production, should be good for another 1.5 million carats a year. Looking farther ahead, Rio Tinto’s (NYSE:RIO) Bunder mine in India is projected to yield another three million carats annually on reaching full production in 2020 or 2021.

“Other new mines under development are relatively small; each is projected to produce one million or fewer carats annually,” the report states.

“Because it takes seven to 10 years to develop a mine, even if major new deposits were discovered within the next few years, there would not be enough time to bring them to full production by the end of the forecast period,” the study adds.

Diamond supply: The Canadian outlook

The supply/demand imbalance notwithstanding, jewelry retailers show increasing eagerness to trace diamonds to ethical sources, Bain points out.

Among those sources is Canada, renowned for high-quality, conflict-free stones. Diamond mining now takes place in Ontario and the NWT, with Quebec expected to join soon and Saskatchewan another possible contender. Output from just three mines in Lac de Gras ranks the NWT region third globally for diamond production by value.

Of those three, Dominion Diamond’s (TSX:DDC) majority-held Ekati is projected to run out of ore in 2019, according to the NWT and Nunavut Chamber of Mines. The chamber gives the Dominion/Rio Diavik operation a life expectancy to 2024 and De Beers’ Snap Lake until 2028.

Rio has since announced plans to bring Diavik’s A-21 deposit online. Yet the chamber maintains A-21’s expected to maintain current production, not extend mine life.

Ekati’s best chance for a stay of execution is the Jay project, “the largest diamondiferous resource in North America,” according to Dominion, and a potential extension of 10 or more years to the Ekati operation. Should environmental approval arrive by the end of 2015, Dominion hopes to begin operations by 2019.

Diamond exploration: The juniors move in

Not surprisingly, it’s up to the juniors to meet growing demand. Since Canadian diamonds are found in kimberlites and kimberlites tend to come in clusters, most exploration takes place near known deposits—with the hope that nearby kimberlites will also contain diamonds.

The hottest hotbed of activity is the NWT, especially around Gahcho Kué. Kennady Diamonds TSXV:KDI holds turf on three sides of the project. Last month the company mobilized for more exploration and delineation drilling on Kelvin, one of the Kennady North project’s four diamond-bearing kimberlites. Diamond recovery results are expected by year-end from two more mini-bulk samples.

Another Gahcho Kué neighbour, Prima Diamond TSXV:PMD holds the 42,000-hectare Godspeed Lake project immediately south of the mine-to-be. Forty kilometres northwest of Gahcho Kué and 35 kilometres east of Snap Lake, Prima holds the 14,000-hectare Munn Lake project. A 581-kilogram sample from one Munn Lake kimberlite gave up 226 diamonds while a 42-kilogram sample from another revealed 14 diamonds. Prima also optioned the Orion diamond property, 2,275 hectares in Quebec’s Otish Corridor, north of Stornoway’s upcoming operation.

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Star-Orion South diamond project gets Canadian environmental approval

December 3rd, 2014

by Greg Klein | December 3, 2014

A proposed Saskatchewan diamond mine cleared a major hurdle with a December 3 decision from Canada’s minister of the environment. Leona Aglukkaq said the Star-Orion South project “is not likely to cause significant adverse environmental effects when the mitigation measures described in the comprehensive study report are taken into account.”

Star-Orion South diamond project gets Canadian environmental approval

A 34.38-million carat reserve would bring an average price
of $242 per carat, according to Star-Orion South’s feasibility.

“The minister has referred the project back to the responsible authorities, Fisheries and Oceans Canada and Natural Resources Canada, for appropriate action,” her statement added.

Part of the project’s property is held 100% by Shore Gold TSX:SGF and part by the Fort à la Corne joint venture, in which Shore has an interest. The project has probable reserves of 279 million diluted tonnes averaging 12.3 carats per hundred tonnes for 34.38 million carats. A 2011 feasibility study projected an average price of $242 per carat throughout the mine’s 20-year life. Different sources estimate global averages for rough diamond prices between about $100 and $120 per carat.

The Star and Orion South kimberlites also hold inferred resources totalling 15.7 million carats.

The feasibility’s base case used a 7% discount rate to calculate a net present value of $2.1 billion and a 16% internal rate of return before taxes and royalties. After those deductions, the study found a $1.3-billion NPV and 14% IRR.

Again using a 7% discount rate, the case 1 feasibility found a $3-billion NPV and 19% IRR before taxes and royalties, and a $1.9-billion NPV and 16% IRR afterwards.

Close to southern Saskatchewan infrastructure, the mine would require an initial capital cost of $1.9 billion, with payback in 5.3 years. Over the life of mine, total capex would come to $2.5 billion. The two open pits would take four years of construction.

Read about diamond supply and demand.

Opportunities in opulence

March 7th, 2014

From Canada to Antwerp, diamond explorers, miners and traders serve a thriving market

by Greg Klein

For giant miners and junior explorers alike, diamonds upheld their market lustre in 2013 and show further encouragement this year. So it wasn’t quite an industry-wide shock when one record-shattering sale fell through. A group of investors fronted by New York diamond cutter Isaac Wolf defaulted on last November’s $83.2-million bid for the Pink Star, Sotheby’s revealed late last month. Now the auctioneer’s out the $60 million guaranteed to the anonymous seller. But the company retains the stone, to which it attributes an “inventory” value of $72 million. Meanwhile, undeterred by the caprice of the super-rich, efforts continue to find, mine and market opulence for the affluent.

This month Rio Tinto NYE:RIO heads to Antwerp and Israel for the company’s first rough diamond tender of 2014. Rio says this offer of 124 lots “showcases a unique combination of white and fancy-coloured rough diamonds” from its mines in Australia, the Northwest Territories and Zimbabwe. Among notable stones from the NWT’s Diavik, Rio’s peddling a 70-carat white diamond, several purple diamonds and some “fancy and intense” yellow diamonds.

From Canada to Antwerp, diamond explorers, miners and traders serve a thriving market

Kennady Diamonds has infill drilling underway
at its Northwest Territories diamond project.

Once pulled out of the ground, about 80% of the world’s diamonds go to Antwerp, the undisputed capital of global trade since the 15th century. The city handles about $11.2 billion worth of rough stones annually, out of a global total of $14.2 billion, according to the Antwerp World Diamond Centre. Vying for a piece of the action are some 1,850 local companies crowded into their own fabled district with “Flemish, Orthodox Jewish and Indian diamantaires working alongside manufacturers, rough and polished dealers, buyers and services providers from almost every country in which diamonds are mined, processed, bought and sold.”

The centre characterized last January as an “excellent 2014 kick-off” in which the value of exports jumped 27.7% and imports 21% over the same month last year. Exports showed “an all-around increase, principally to the usual consumer markets India, the United Arab Emirates and Hong Kong.”

Polished diamonds picked up too. January exports improved 9.69% and imports 13.79% in value over the same month in 2013.

Although the stones’ esthetic vagaries complicate matters, diamond prices remained relatively stable last year, avoiding the declines seen in precious metals. Giants did well, with Rio reporting a 15% increase in diamond revenue over 2012. De Beers proclaimed 2013 “a strong year of growth” for its Forevermark diamond brand, “driven predominantly by continued consumer demand in core markets, China, U.S., India and Japan.” Many Canadian-listed juniors and mid-tiers rose well above the malaise suffered by their counterparts in other commodities.

Among activity within Canada, Kennady Diamonds TSXV:KDI continues working towards a maiden resource for its eponymous project in the NWT. Infill drilling began last week, according to a March 6 statement, part of a plan to better define the Kelvin kimberlite body prior to a mini-bulk sample of 25 to 30 tonnes. Last year a 4.3-tonne sample from Kelvin showed 5.38 carats per tonne with the three largest diamonds comprising “a 2.48-carat off-white transparent octahedral, 1.06-carat off-white broken aggregate and a 0.9-carat off-white transparent irregular,” Kennady stated.

The March 6 update also reported an amended exploration agreement with the Lutsel K’e Dene First Nation and receipt of a five-year land use permit and seven-year water licence.

The same day Shore Gold TSX:SGF announced a “target for further exploration” for its central Saskatchewan properties. A TFFE uses exploration data to disclose potential quantity and grade that might not be realized in an eventual resource estimate. On that basis, Shore’s TFFE for seven kimberlites “is estimated to include between 983 million and 1.17 billion tonnes of kimberlite containing between 52 and 90 million carats.”

The seven kimberlites spread over two properties, Shore’s wholly-owned Star-Orion South project and the adjacent Fort à la Corne, a joint venture shared 67%/33% between Shore and Newmont Mining Corp of Canada TSX:NMC.

A 2011 feasibility study showed a probable reserve for the Star and Orion South deposits:

  • Star: 165.89 million tonnes averaging 12.3 carats per hundred tonnes for 20.386 million carats of diamonds

  • Orion South: 113.09 million tonnes averaging 12.4 cpht for 13.994 million carats

  • Total: 278.98 million tonnes averaging 12.3 cpht for 34.38 million carats

The two deposits also have inferred resources totalling 9.1 million carats.

In other Canadian diamond activity, North Arrow Minerals TSXV:NAR closed a $5-million private placement late last month to fund three projects, two of them 80% options with Stornoway Diamond TSX:SWY. The Qilalugaq property in Nunavut is slated for a 1,500-tonne bulk sample and an Antwerp valuation next summer. Pikoo, a Saskatchewan project heralded for its diamond discovery in November, is expected to undergo till sampling this year to seek out additional kimberlites.

On the earlier-stage Redemption project in the NWT, North Arrow holds a 55% option with Arctic Star Exploration TSXV:ADD. This year’s plans include till sampling and geophysics at the 11,493-hectare project, 32 kilometres from the Ekati mine and 47 from the Diavik mine.

Dominion Diamond TSX:DDC looms large in the region, holding an 80% interest in Ekati, 58.8% of the mine’s Buffer zone and 40% of Diavik. Chuck Fipke and Stewart Blusson, two pioneers of Canadian diamond exploration, each hold 10% of Ekati, while Rio holds 60% of Diavik. Dominion ranks fourth worldwide for diamond production by value.

An Antwerp report that came through in late February evaluated a 1,013.5-carat parcel of commercial-size stones for Peregrine Diamonds TSX:PGD. Taken from the CH-6 kimberlite pipe in Nunavut, the gems were priced at an average of $213 per carat for a total of $215,605. Peregrine has a resource scheduled for CH-6 by the end of Q2.

The valuation was conducted by WWW International Diamond Consultants, a company that’s familiar with Canadian projects and currently evaluating diamonds for Gahcho Kué in the NWT. JV partners De Beers (51%) and Mountain Province Diamonds TSX:MPV (49%) plan to use the data in a feasibility update scheduled for release by the end of March. Gahcho Kué’s expected to become Canada’s next diamond mine.

Read more about diamond mining and exploration in Canada here and here.

Beautiful, brilliant, bloodless

November 22nd, 2013

Exploration gains momentum as the world’s affluent covet Canadian diamonds

by Greg Klein

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The old saying aside, diamonds are not forever—not when existing supplies are depleting. So the search continues for new deposits. And it’s in Canada, the country that transformed the international market with its high-quality, ethically produced stones, that much of the exploration takes place. Now the market might be facing another transformation, not from new supply in Canada but new demand in China and India.

“Historically that’s not where most of the diamonds have been sold,” says Patrick Power, president of Arctic Star Exploration TSXV:ADD. “But they’re opening up right now largely due to the efforts of De Beers. China and India have never been incorporated into any [forecast] number before.”

As luxury items—industrial diamonds play a negligible role in the market, Power says—the gems’ value depends on the alliterative vagaries of colour, clarity, cut and carats. Esthetic values can be subjective, but a complete lack of colour generally gives a diamond the highest value. Clarity concerns the absence of imperfections. Cut involves the technical precision in faceting a stone’s shape to enhance its colour and brilliance or “fire.” Of course greater weight, measured in carats, also increases value.

Exploration gains momentum as the world’s affluent covet Canadian diamonds

But the value of Canadian diamonds goes beyond the four Cs. Power puts it bluntly: “They’re not blood diamonds. They’re ethically mined. All parties participate in the wealth. So there’s a premium paid for that,” he explains.

“Plus they’re fantastic diamonds. De Beers’ Victor mine in northern Ontario is producing stones that are $400-plus a carat. That’s an amazing diamond. So we have quality plus branding. Canada was the first country ever to brand diamonds, with the polar bear diamond and the maple leaf diamond. Ekati and Diavik put micro-signatures on each diamond’s girdle. That’s Canadian. No one ever did that before.”

Supply/demand predictions can be troublesome. But the supply of diamonds above one carat (0.2 grams) marks the point “where they start to get scarce,” Power says. “And if you want two, three, four carats of better-quality diamonds, you can tell your supply is dropping.”

Of course growing affluence in emerging markets, where De Beers has been peddling its opulence, would seem to enhance demand. As for the ultra-wealthy, they’re paying record-breaking prices. In early November Christie’s sold “the largest fancy vivid orange diamond ever offered at auction (14.82 carats)” for $35.5 million. The company had hoped for about $20 million.

Just one day earlier, Sotheby’s sold the 59.6-carat Pink Star for $83.2 million.

But the excitement’s not limited to the über rich. The people who search for the stones have a passion of their own. “What’s really exciting for those of us exploring in the Northwest Territories is that the technology is changing for the first time in a long time. We can look again at ground that was previously explored and find new stuff,” Power says.

In particular, a helicopter-borne gravity gradiometry survey over Arctic Star’s Redemption project in the Lac de Gras diamond fields found 32 anomalies, including some at the head of a glacial mineral train. The results, announced in October, could indicate the presence of kimberlite pipes among the more dense granitic rock.

Developed by Lockheed Martin and BHP Billiton NYE:BHP at least 15 years ago, the technology’s been available to other companies for less than three years, Power explains. “It’s now the third generation of that system. We’re amazed at the high-quality data, as compared to the first generation when BHP flew Ekati way back when. Gravity is a very difficult, time-consuming and expensive thing to do on the ground. Surveys are traditionally small. But you can fly the entire area with this system. We’re seeing things that we haven’t seen before.”

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