News

May 20, 2009

The Sun Has Not Yet Set On Sunrise Diamonds, Although A Little Bit Of Diversification Looks A Distinct Possibility In The Near Future

By Alastair Ford

From his offices in Sunrise House, Macclesfield, Patrick Cheetham paints a mixed picture about what the future holds for Sunrise Diamonds. On the one hand, the mood is fairly clear when he states, straight off the bat, “we said in our last annual report that we wanted to broaden our commodity focus”. In a way, that’s no surprise. The rough diamond market has taken a real hit over the past year or so, and even though it does boast a few diamondiferous kimberlites to its name, Sunrise isn’t even close to production. Development funding for diamond projects that are a long way even from proper economic studies would be a tough ask in these markets.

Shares in Petra Diamonds, a company that’s just sold a fancy blue stone for a record US$9.5 million, have lost nearly two thirds of their value over the last twelve months. What chance does poor Sunrise Diamonds have, with a market capitalization 100 times smaller than Petra’s? It’s a truism at the moment that there’s no money around for exploration, even in commodity spaces like gold and copper that are doing reasonably well. But any mention of diamonds in the same sentence as the word...