Yellowknife (Sep 12/03) - Premier Stephen Kakfwi has officially apologized to De Beers.

The apology came Wednesday morning after his comments Monday in an interview with The Globe and Mail in New York City. He said that De Beers was trafficking in "dirty diamonds."

Dirty diamonds or 'blood diamonds' are diamonds which have been extracted either at gun point by guerilla movements, at times involving slave labour, or diamonds which have been stolen by thieves or warlords.

The premier said his comments came about as a result of frustration over difficult negotiations for a diamond-sharing deal with De Beers.

"I have spoken to the people at De Beers and have apologized" said Kakfwi. "We agreed we had business to do. It's important to correct the record. It was done in the frustration of the moment."

The Government of the Northwest Territories has been working toward establishing a secondary diamond polishing industry, but De Beers opposed the idea up to the end of last year.

De Beers balks

In December 2002, Yellowknifer reported that De Beers had agreed to set aside some of its gems for Northern manufacturers.

In response to questioning from GNWT representatives at the Mackenzie Valley Impact Review Board's De Beers Snap Lake Technical sessions in December 2002, De Beers Canada President Richard Molyneux said: "What I said is, yes, we have already tabled proposals which would include the supply of Snap Lake production directly to stakeholders, including aboriginal groups."

One month earlier in November 2002, Yellowknifer reported that De Beers had delayed its Snap Lake project twice and the sticking point was a disagreement between the territorial government and De Beers over rough diamonds. Four years earlier, in February 1998, George Burne, a director with De Beers, said in response to the desire to create a secondary diamond polishing industry that the Northwest Territories should stick to what it does best -- mining -- and forget about cutting and polishing.

Face to face meetings

Molyneux is scheduled to arrive in Yellowknife next week to speak with the premier and continue negotiations.

The territorial government has been able to arrange diamond-sharing arrangements with BHP Billiton and Diavik, but the deal with De Beers seems harder to make.

"There has been a lack of progress in the talks with De Beers and it shows in my frustration. We've been in negotiations for well over a year and at one point our officials thought we had agreed on a quantity of diamonds," said the premier.

"Indications were given last year and since January that agreement has been slowly retracted," said Kakfwi.

According to De Beers Canada spokesperson, Linda Dorrington, De Beers offered aborigional groups a chance to buy into the Snap Lake project which would entitle them to a share of the diamonds. To date, she said, the offers have not been taken up.