Doug Ashbury
Northern News Services

Yellowknife (Aug 21/00) - Diamond jewelry making should shine in the North's future.

"Given time, and an economic framework for sustainable development, there is little doubt that a small, but important, diamond manufacturing and jewelry manufacturing industry will develop in the North," according to Dia Met Minerals' recent annual report.

Dia Met owns 29 per cent of the Ekati diamond mine 300 kilometres northeast of Yellowknife.

The North's diamond manufacturing and a potential jewelry-manufacturing industry will "not be based on large volumes, but on the skilled use of a fine, high-quality resource," he added.

There are currently two firms cutting and polishing Ekati diamonds in the North.

Aurora College in the NWT and Nunavut Arctic College in Nunavut currently offer jewelry-making courses.

Mike Shouldice, campus director at the Aurora College campus in Yellowknife said Northern diamond jewelry is a natural.

"The college has a history of jewelry-making courses," he said.

Artists are incorporating Northern rock into their works and diamonds could certainly be used, he said.

The college is also "looking at polishing diamond indicator minerals" to be used in NWT-made jewelry, he added.

In the annual report, Dia Met chairman Peter Atkinson said Ekati has quickly established its credentials as a world-class asset with margins that are closer to those of silicon valley than the Canadian North.

"Dia Met catapulted to Canada's ninth most profitable mining company and the nation's 163rd most profitable public company in fiscal 2000," Atkinson, citing the Globe and Mail's Report on Business, said.

Dia Met made $47.5 million last year. The company's share of diamond sales from the mine was $161.2 million. Dia Met expects to eliminate all debt in the next two years.

In fiscal 1999-2000, Ekati produced 2.5 million carats with 2.2 million carats sold at $168.05 US per carat. That is well above the $130 US per carat price in the 1997 feasibility study.

The higher per carat average was a function of a more buoyant market and the quality of stones from Ekati. In fact, Dia Met said quality, as opposed to world markets, was the main factor for the increase.

As for future projects, Dia Met says Ekati has the potential for additional resources.

The company is also continuing work on two Arctic joint-ventures on Victoria Island. The Victoria Island projects are Dia Met's first new projects in Canada since the discovery of the Ekati mine.

The first agreement, the Mariner project, includes Dia Met, which operates and manages the project, and Major General Resources and Ascot Resources. The second is the Home Run project, a partnership between Dia Met and Major General.