News

March 03, 2009

Firestone Diamonds Is Just A Signature Or Two Away From Locking Down Hundreds Of Millions Of Dollars In Future Revenues

By Alastair Ford

Who’d be a diamond miner right now? On the ground the harsh answer is: fewer people than before. Up at Snap Lake in Canada, and over at Ekati there are fewer people digging up the stones. And down at Orapa in Botswana, and over at Damtshaa, famous mines all, work is grinding to a halt. The harsh reality is that rough diamond prices are on the floor and showing no signs of picking up. This cold new world has caused shudders throughout the industry, as De Beers holds out the begging bowl for US$500 million, as Alrosa stops selling onto the open market, as the January tender price for diamonds from Gem Diamonds’ renowned Letseng mine is reported to have dropped by over 50 per cent, and as funding for new projects has almost completely dried up.

And that’s just the majors. Being a junior company in the diamond space is very lonely right now: Pangea Diamondfields keeps issuing press releases about shortfalls in a proposed fundraising that’s been going on for months, Brazilian Diamonds has gone pretty quiet, sugardaddy Middle Eastern investors haven’t romped into the market to prop up Petra Diamonds’ shares for some time now, Kimcor has pretty well gone under, and Diamonex, which was all frills and optimism last year, seems to have...