In the media

Mine diamond supply down to less than 20 years, says DiamondCorp ahead of listing

28 March 2008

Source: Mineweekly

Author: Martin Creamer

The world was down to less than 20 years' mine supply of natural diamonds from known mine operations, said DiamondCorp CEO Paul Loudon on Friday, ahead of the company's main-board JSE listing on Monday.

Loudon said that the world was consuming more diamonds than mines were producing and the price outlook for diamonds was ‘very strong' in the medium-to-long term.

In the short-term, however, the economic downturn in the US would affect diamond prices, as the US still dominated the jewellery end of the market, accounting for half of diamond end-use.

But at the same time there was a continued growth in demand for diamonds coming from China, India and from other emerging economies.

"Our own experience in tendering diamonds so far this year is that prices continue to strengthen," the former investment banker, whose DiamondCorp was listed on the London AIM in February 2007, told Mining Weekly Online.

There was strong demand coming particularly from the Indian market for small goods.

DiamondCorp had more than 100 employees on site at its Lace diamond mine in South Africa's Free State province, where the company had already built a large 4 000 t/d dense media separation plant, able to handle 220 t/h at the front end.

"We are starting off by putting tailings through, and we are very excited by the quality of the diamonds being recovered. What we see in the tailings is a window into the main pipe and our white diamonds are very white, and we jump almost straight away to fancy colours, lemon yellow, golden yellow and, most exciting, the Lace lilacs, which are intense purplish-pink diamonds. Fantastic colours," he said.

DiamondCorp owned its mining fleet, bought from local manufacturer Bell Equipment, and had just taken delivery of the first of its underground mining equipment, supplied by Sandvik.

He said that the company was about to begin sinking a new 4 m-square decline shaft and would begin to access kimberlite in the next three to six months.

There were more than 35-million tons of kimberlite at Lace and more than 13-milion diamond carats to support a 20-year-plus operation.

The mine was being put back into production for the first time since being shut in 1930.

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