Doug Ashbury
Northern News Services

NNSL (Mar 10/99) - Arctic Diamonds International Inc. has been given conditional approval to set up a diamond-cutting and polishing business in the NWT, Economic Development deputy minister Joe Handley confirmed Monday.

"The main (condition) is access to rough diamonds," Handley said.

"Without this, they can't do business," he said.

"They have to have the product to work with so they have to have an agreement with BHP."

Arctic Diamonds is 50 per cent Northern owned and 50 per cent Belgian-southern Canadian owned.

Among the Northern owners of Arctic Diamonds is former premier Dennis Patterson who now lives in Iqaluit. Others are Jack Walker, Les Rocher, Alex Arychuk, Gordon Humphries, Mike Stilwell and Alan Vaughan, all of Yellowknife.

The lead Belgian is Herman Habraken who first came to Yellowknife last year with Canadian Diamonds International.

"We're in the midst of negotiations with BHP and they are progressing smoothly," Vaughan said.

If Arctic Diamonds goes ahead, it will ultimately employ 32 in cutting and polishing as well as eight people in other positions. The group would take up space in a downtown Yellowknife office building.

As part of the proposal, Arctic Diamonds would require GNWT to guarantee bank loans. The company would use the money to buy rough diamonds.

The GNWT, whose Financial Management Board gave Arctic Diamonds' plan conditional approval last month, requires the company to manufacture in the North.

The government would also impose training requirements on the joint- venture. Arctic Diamonds is seeking GNWT financial assistance to train diamond- cutting and polishing staff.

If Arctic Diamonds gets the go ahead, it will be the second cutting and polishing operation after Sirius Diamonds.

Last week, Handley said there are 10 diamond- cutting and polishing plant proposals before the GNWT -- among them the Arctic Diamonds plan.

It is not certain just how many value-added jobs will emerge from diamond mining. But Handley said he is confident there will be at least 100 people working in this sector in the North in a year.

A year ago, Habraken, then president and CEO of Calgary-based Canadian Diamonds International, said one-tenth of BHP's gem-quality stones could generate up to 300 cutting and polishing jobs as well as 50 or 60 related jobs.