Diavik diamonds a hit in debut

Gary Park

Petroleum News Calgary correspondent

The international diamond market is already giving an enthusiastic reception to gems from the Diavik mine in the Northwest Territories.

The $1.3 billion mine — jointly owned by Britain’s Rio Tinto and Toronto-based Aber Diamond — has found outlets with Tiffany & Co. and a Belgian enterprise that operates factories in Antwerp, Vietnam and Vancouver, British Columbia, only nine months after the first diamonds were produced.

Vancouver-based Lugaro Jewellers, which runs an eight-store chain, has also switched to Diavik from Ekati, the pioneering diamond miner in the Northwest Territories.

Aber is selling its 40 percent share through Tiffany’s and its own outlet in Antwerp, while Rio Tinto has selected core customers that will purchase rough goods for cutting and polishing.

Rio Tinto’s buyers include Vancouver-based HRA Investments, a Canadian branch of a family-owned Belgian firm that has been in the diamond business for 50 years.

It is believed Rio Tinto has another six or seven core customers worldwide, although their identities have not been disclosed.

HRA, which employs 13 people in Vancouver and uses a robotic technology, is able to polish a diamond in less than two hours, instead of the usual, labor-intensive methods that take more than a day.

Aber reported revenues from Diavik of $19.2 million in the first half of 2003, even though the mine was still not working up to full capacity. Its share values have climbed by 27.5 percent this year.