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Diamonds – Mining, Lab-Grown and Conflict/Blood

Diamonds Snapshot: Six juniors staying in the game – by Alisha Hiyate(Northern Miner – June 13, 2020)

https://www.northernminer.com/

For companies without the size and heft of the big producers De Beers and Alrosa, the diamond space has always been a challenging one – even before the coronavirus pandemic. But with long-term fundamentals that point to a bright future for diamonds, some juniors are finding ways to advance their projects, despite the tough times.

Here’s a look at several active Canadian-based diamond explorers (and one miner), with a focus on the prospective and friendly jurisdictions of Canada and Botswana.

Adia Resources – Adia Resources is a private company held 54% by royalty company and prospect generator Altius Minerals (TSX: ALS; US-OTC: ATUSF). The company is advancing the 1,640-sq.-km Lynx project, near Oxford House, Man., where it has recovered microdiamonds not from kimberlite, but from Archean age volcaniclastic rocks.

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Dominion Diamond sues partner in Diavik mine for breach of contract, other allegations – by Sara Minogue (CBC News North – June 16, 2020)

https://www.cbc.ca/news/canada/north/

Dominion Diamond Mines has filed a lawsuit accusing Diavik Diamond Mines (2012) Inc. — its 60 per cent partner in the Diavik diamond mine in the Northwest Territories — of managing the mine to the benefit of its majority owner, Rio Tinto, and to the detriment of Dominion.

The civil lawsuit, filed Tuesday with the Supreme Court of British Columbia (where Dominion is incorporated), claims Diavik Diamond Mines (DDMI) has continued to make cash calls from Dominion “knowing that Dominion has no ability to pay for such cash calls.”

Cash calls are basically requests from Dominion’s partner in the mine to cover its share of operating costs or other obligations.

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The downfall of Dominion Diamond – by Alex Brockman (CBC News – June 10, 2020)

https://newsinteractives.cbc.ca/

How the COVID-19 pandemic pushed one of the North’s largest employers to the brink of financial collapse

A light breeze from Great Slave Lake adds a last bite of winter to the warm spring air as Chief Ernest Betsina walks through Ndilo, a Yellowknives Dene community down the road from Yellowknife.

After a few minutes, he stops at a high spot. The entire community stretches before him. He can see the abandoned Giant gold mine site across the bay. It’s a festering wound, the worst-case scenario when a mine company goes under.

Today, another mining company, Dominion Diamond, is fighting off its own financial ruin. Its cash reserves collapsed amid the COVID-19 pandemic, leaving it with $1.2 billion US worth of debt it has no way to pay off unless it restructures itself through the courts.

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The Great Diamond Glut: Miners Stuck With Gems Worth Billions – by Thomas Biesheuvel (Bloomberg News – June 7, 2020)

https://finance.yahoo.com/

(Bloomberg) — In one of the world’s biggest diamond vaults, hidden inside a nondescript office compound on the dusty outskirts of Botswana’s capital, the precious stones just keep piling up.

Owner De Beers, which mines and auctions most of its gems in the southern African nation, has barely sold any rough diamonds since February. Neither has Russian rival Alrosa PJSC.

Now, as the coronavirus restrictions that froze the global industry for months begin to lift, the unsold diamonds present a dilemma: how to reduce billions of dollars’ worth of stocks without undermining the nascent recovery.

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Urgent plea to allow struggling alluvial diamond sector to create jobs – by Martin Creamer (MiningWeekly.com – June 3, 2020)

https://www.miningweekly.com/

JOHANNESBURG (miningweekly.com) – The discovery of alluvial diamonds in the unique secondary deposits of the Middle Orange River downstream of Hopetown in South Africa in 1867 was the catalyst that initiated the development of the mining industry in Southern Africa.

But compared with its heyday between the 1990s and early 2000s, today’s junior diamond mining sector is but a shadow of its former self, says the South African Diamond Producers Organisation (Sadpo) deputy chairperson Lyndon De Meillon.

Independent studies have shown that the sector has shrunk by 90% over the past 20 years, mainly because of poor legislation and over-regulation.

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How Lab Grown CVD Diamonds Can Be India’s Ace Card In Global Gems & Jewellery Industry (Diamond World – May 26, 2020)

https://www.diamondworld.net/

In times when the global diamond industry had been challenged with declining natural diamond prices driven by decreased global consumption, geopolitical tensions, reduced financial aid from banking institutions, demonetisation struggles in India and a collective scale-back of production by the miners worldwide, lab grown diamonds have seem to emerge slowly as a ray of hope and establish a growing footprint in the gems and jewellery industry.

2019, particularly, was the year for lab-grown diamonds. India, alone, witnessed a sharp rise in LGD exports worth $443 million which were up by 102% y/y. Even at the start of 2020, lab-grown diamond exports in India were up by 60% y/y, while natural diamond exports were down by 41% y/y.

Whilst the lab-grown diamond industry had seen a significant price correction in recent years with the technology evolving and the cost of technology coming down, lab-grown diamond prices, particularly CVD diamonds, have now stabilized. In fact, CVD diamonds above 1ct saw a 29% price rise in the last quarter of 2019 driven by significant demand and limited supply.

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De Beers diamond mines win industry awards for safety record – by Walter Strong (CBC News North – May 8, 2020)

https://www.cbc.ca/news/canada/north/

Gahcho Kué and Victor mines both multiple year safety award winners

The De Beers Gahcho Kué and Victor diamond mines have received industry awards this year for their safety records.

The Canadian Institute of Mining, Metallurgy and Petroleum (CIM) has named the N.W.T.’s Gahcho Kué mine as the national 2020 John T. Ryan award winner for the lowest reportable injury frequency in the previous year.

According to a press release from De Beers Thursday, the mine “reduced the number of injuries by 38 per cent compared to 2018 and had zero lost-time injuries during the year.”

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A look inside the finances of Dominion Diamonds, the mine company now under court protection – by Alex Brockman (CBC News North – April 25, 2020)

https://www.cbc.ca/news/canada/north/

When the Washington Companies, a U.S.-based conglomerate bought Dominion Diamonds in 2017, a curtain fell over one of the world’s largest diamond companies and significant employers in the Northwest Territories.

After the sale, Dominion became a private business and faced far fewer requirements on what it had to share with the public, and was able to operate with little scrutiny as it ran the Ekati mine and a 40 per cent stake in Diavik, two of the territory’s three diamond mines.

For the past three years, the company hummed along, freed from the obligation to report on its business to shareholders or the public.

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Opinion: Diamonds need some new best friends – by Clara Ferreira Marques (Bloomberg News – April 24, 2020)

https://www.bloomberg.com/

It’s looking decidedly somber out there for the world’s favorite sparkly stone. Diamonds were ailing even before the coronavirus came along. Now, weeks into lockdowns in the U.S. and elsewhere, all but the largest diggers, polishers and retailers are struggling for cash.

Unable to sell its stones, Dominion Diamond Mines, the miner that sold luxury brand Harry Winston to Swatch Group AG in 2013, filed for insolvency protection late Wednesday. Anglo American Plc’s De Beers cut 2020 production guidance by a fifth Thursday, in line with demand.

To secure their future, diamond giants may need a rebranding akin to the storytelling feat pulled off by Harry Oppenheimer, the late De Beers chairman who cultivated the engagement ring to overcome a slump after the Great Depression.

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North: Diamond mines exempt from coronavirus travel restrictions due to economic importance – by Richard Gleeson (CBC News North – April 22, 2020)

https://www.cbc.ca/news/canada/north/

A glaring exception to travel restrictions placed on those entering the Northwest Territories during the COVID-19 pandemic is the one made for workers at the territory’s three diamond mines.

At the mines, people from the N.W.T. work alongside those from provinces where there have been far more confirmed cases of the highly contagious respiratory disease. None of the workers from outside the N.W.T. are required to self-isolate for two weeks like most others arriving in the territory.

In an email, the territories’ chief public health officer said the mines are allowed to continue operating because of the huge role they play in the N.W.T.’s economy.

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North: ‘All bets are off’ as Dominion Diamond Mines faces severe cash crunch – by Walter Strong (CBC News North – April 22, 2020)

https://www.cbc.ca/news/canada/north/

Dominion Diamond Mines has been granted a reprieve after filing for insolvency protection, the company announced Wednesday in a press release.

According to the release, the company and some of its affiliates “have filed for insolvency protection under the Companies’ Creditors Arrangement Act (CCAA)” and has received an order from the Alberta Court of Queen’s Bench granting protection to the company under the act.

“Dominion intends to use the CCAA process to engage in discussions with its lenders, creditors, equity owner and other stakeholders and to solicit and evaluate strategic alternatives to restructure the company financially and operationally, and position it for long-term success when global economic and industry conditions improve,” the press release states.

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Diamond Crash. Just Don’t Ask How Bad It Is. – by Tim Treadgold (Forbes Magazine – April 15, 2020)

https://www.forbes.com/

How low can diamond prices go? That’s a question which no-one can answer, but it’s also a question which the diamond industry wishes no-one would ask, judging by an unsightly spat which has engulfed the normally well-mannered jewelry trade.

The diamond crash, which has been several years in the making, has been magnified by Covid-19, the coronavirus disease which has put the world in lock-down, forcing the closure of jewelry shops and trashing the share-prices of diamond mining companies.

Some smaller diamond miners, such as London-listed Petra Diamonds, have seen their shares plunge by 75% since the virus outbreak started in January. Others, such as Russia’s diamond champion, Alrosa, have fallen by 30%, despite having currency protection as the ruble has taken a dive against the U.S. dollar.

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Covid-19 robs diamond sector of recovery hopes – by Cecilia Jamasmie (Mining.com – April 1, 2020)

https://www.mining.com/

The rapidly-spreading coronavirus pandemic has quashed diamond miners’ dawning hopes of a recovery in a sector severely hit by weak prices and demand since late 2018.

The market began suffering from the effects of the covid-19 spread in early March and measures to contain it has already pushed De Beers, the world’s largest producer by value, to cancel its April sales event.

Russia’s Alrosa, the world’s No.1 producer by carats, is studying options for online trade as global travel restrictions make traditional physical inspection of gemstones almost impossible.

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Lucara’s Eira Thomas has a knack for finding huge diamond reserves. Now she want to disrupt the industry – by Alanna Mithell (Globe and Mail/ROB Magazine – March 27, 2020)

https://www.theglobeandmail.com/

‘What started out as a treasure hunt is now much more about how we make a lasting contribution to the communities we are working with,’ the CEO and geologist says

Eira Thomas is on the run. The annual results for her company, Vancouver-based Lucara Diamond Corp., are coming out in 11 days, and as its co-founder and chief executive, she is prepping for a round of board meetings and earnings presentations, including dashes to both Florida and Toronto for mining conferences.

Before that, she’s heading from her home in England to Morocco on a half-term school break with her two daughters. Plus, she’s experiencing such wretched technical glitches that she missed a Skype interview yesterday and had to rebook. Today, she apologetically comes on 24 minutes late, something so uncharacteristic that her personal assistant, who is in Zurich, has begun to worry. Life is a little frenetic, Thomas confesses.

Yet, when I ask her why diamonds hold such an allure, all of a sudden, the busy executive life seems to vanish. She savours her answer—and when it comes, it’s unexpected. Yes, there’s the thrill of the hunt. But she is a geologist, and so within the diamond she also reads the violent secrets of the inner Earth that created it billions of years ago, when the planet was much younger.

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Alrosa CEO says virus outbreak affects 2020 sales outlook – by Mariaan Webb (MiningWeekly.com – March 11, 2020)

https://www.miningweekly.com/

The outbreak of a new strain of coronavirus, Covid-19, has weighed on diamond demand in February and will negatively impact on Alrosa’s sales outlook for 2020, CEO Sergey Ivanov said on Wednesday.

The Russian miner reported rough and polished diamond sales of $346.4-million in February, down 14% on January’s sales. “Though our January and February sales were healthy, currently we are seeing a decrease in demand,” Ivanov said in a transcript of a conference call, published on its website.

Alrosa had given its customers additional flexibility in terms of sales in March, he said, adding that the group would have to wait and see how the situation played out in April and May.

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