Gem Diamonds doubling Lesotho
by Reuters South Africa
Miner Gem Diamonds is doubling the size of its Lesotho mine and expects to find more large diamonds in excess of 100 carats there, its CEO said on Monday.
Three of the largest 20 diamonds ever mined have been recovered at the Letseng le Terai mine, including a 493-carat rough diamond which sold at auction for $10.4 million in Antwerp last week to Graff Jewellers.
"We're about to double the size of Letseng production," Gem Diamonds CEO Clifford Elphick told Reuters on the sidelines of a conference on investment in sub-Saharan Africa, noting that the mine will process about five million tonnes of ore a year.
Gem Diamonds has said the 493-carat Letseng Legacy diamond, recovered at Letseng le Terai mine in September, sold for an extraordinary price of $21,000 per carat, against a global average diamond price of $81 per carat.
Elphick said the Lesotho le Terai mine should be fully onstream by the end of the first quarter in 2008 after doubling production, and that he expected the mine to yield more large diamonds, possibly several a year each exceeding 100 carats.
The market for large diamonds is vibrant due to demand from a growing club of super-wealthy people enriched by the commodities and oil boom and the strength of emerging markets, the CEO said.
"If you look at the wealth effect, be it strong commodity prices, strong emerging markets, those people have a strong appetite for large diamonds," he said.
Gem Diamonds' Lesotho mine produces predominantly white diamonds, although a huge, 601-carat brown diamond was recovered there in 1961.
The largest rough gem-quality diamond ever found was the Cullinan Diamond, found in South Africa in 1905, at 3,106.75 carats.
Gem Diamonds is a two-year-old company operating mines in southern and central Africa and Indonesia.