Yellowknife (Oct 15/03) - The president of Sirius Diamonds speaks with a quiet passion for the diamond cutting industry and with pride about his cutting and polishing house in Yellowknife.

The city's cutting and polishing industry became the focus of debate when De Beers Canada disagreed with the territorial government's requirement that it supply rough diamonds to local processors.

More than money is involved in the debate and the decision to cut and polish diamonds in Yellowknife, says Stephen Ben-Oliel, president of Sirius.

Ben-Oliel contends that diamonds from Canada's Arctic can be successfully marketed throughout the world, but cutting and polishing stones in Yellowknife doesn't always meet the hard test of economics.

The wages here are extremely high when compared to rates available in countries like India, Ben-Oliel says.

But at the same time, Ben-Oliel says there's a social component to what Sirius is doing in Yellowknife.

Aboriginal people in the North have an opportunity to pick up a trade that has usually been passed down from father to son or from mother to daughter.

"If nothing else, when we look back at our experience in Yellowknife we'll be able to say we created some master diamond cutters who can work anywhere in the world," he says.

The best in the world

Ben-Oliel has worked as a diamond inspector and cast a practised eye over millions of stones. He says the diamonds in the Northwest Territories are some of the best he's ever seen.

"We're cutting the best diamonds the world has ever seen. We created a stone and have had it sold out since the day we got it but BHP won't supply us with the rough we need for it, and it's been a clear sell out from Day 1," he said.

The stone is called the Princess Cut.

"We could dedicate to the Princess Cut entirely but we don't get the rough for it. Past that, we developed a brand new diamond, Sirius Northern Lights. It's a complicated diamond that wouldn't have been attempted 20 years ago. It's a beautiful diamond, it comes back to having the right rough," he says.

Getting the right rough diamonds is key to running a profitable cutting and polishing house.

Ben-Oliel said his costs remain fixed whether cutters are working on a $20,000 diamond or a $200 diamond.

"I could take you to India and you would wonder why would anyone go North when they cut at third-world wages. Why? We can market a diamond.

"Our fastest growth today is outside Canada."

Ben-Oliel's costs aren't as fixed as he'd like them to be. Competition for cutters is fierce in Yellowknife and the wages in the mines are substantially higher.

"All the money doesn't buy all the happiness. It's hard to see when you're living hand-to-mouth. I believe people get a sense of self-satisfaction by doing what they choose to do.

"The best thing we can do in the North, even if I can't accomplish anything else, we've created the world's master diamond cutters. It's a craft, a skilled trade, they can go to New York and earn $6,000 a month."

Ben-Oliel also put in historical terms what the diamond industry could mean to the North.

For the first half of this century the diamond mining industry and the spin offs from that industry could be the most important industry the North has, he said.