Yellowknife (Sep 10/03) - Premier Stephen Kakfwi will publicly "correct" statements he made in New York Monday when he said the De Beers Group was trafficking in dirty diamonds.

An article in Tuesday's Globe and Mail quotes Kakfwi stating "De Beers mixes all its diamonds, whether from Siberia or Angola or South Africa or Botswana. They just put it all together. They do not want to identify the source of diamonds because a huge portion of their diamonds comes from countries of dubious character, dubious governments. They do business with guerilla movements, and people are concerned about it."

De Beers challenged the premier's statement, denying that it trades in so-called 'blood diamonds,' adding it played a "leading role in the Kimberley Process," a government and industry-supported certification process which allows authorities to identify and certify the origin of diamonds.

"I thought he knew a little more about the diamond business than he appears," said John McConnell, De Beers vice president for NWT projects.

Kakfwi was unavailable for comment Tuesday, but press secretary Drew Williams confirmed the premier will issue a statement "correcting" his comments.

A statement from the premier's office is expected Wednesday and the premier himself is expected to address during a speech in Toronto Thursday.

The premier met with Prime Minister Chretien in Quebec Tuesday.

De Beers is currently negotiating with the territorial government on how diamonds mined at Snap Lake will be supplied to local polishers.

So far, De Beers has only agreed to supply "parcels" of diamonds to the polishers, not specifically Arctic diamonds.

NWT Finance Minister Joe Handley offered his support to the embattled premier.

"We all make mistakes and occasionally say things that are wrong."