Northern News Services
Published Wednesday, August 22, 2007
YELLOWKNIFE - Yellowknife's diamond manufacturers could get a little busier when De Beers Canada's Gahcho Kue project begins production.
the Gahcho Kue project is about 300 kilometres northeast of Yellowknife
10 per cent by value of economically cuttable rough diamonds from Gahcho Kue will be made available to NWT manufacturers
the mine is expected to produce 2.1 million tonnes, or 3 million carats of diamonds a year for 15 years
average diamond value is estimated to be $67 U.S. per carat
the mine is a joint venture between De Beers and Mountain Province Diamonds
400 people will be employed at Gahcho Kue during production
the Gahcho Kue project is currently in the Environmental Impact Review process
- Source: De Beers Canada
An agreement announced last week between the Government of the Northwest Territories and De Beers states 10 per cent by value of economically cuttable rough diamonds from the proposed Gahcho Kue will be made available to approved NWT manufacturers.
The agreement is similar to the Snap Lake arrangement announced in February, and it's good news, according to Bob Bies, director of operations at Arslanian Cutting Works.
"It's making available rough diamonds that we can make money with," said Bies.
"If we're selected, it could mean more jobs for the North. It would mean we would grow as a company. Our production would grow."
Arslanian has a staff of 56 that cuts about 130 diamonds a day and processes about 3,500 carats per month.
Those numbers could rise if the business meets the selection criteria laid out by the Diamond Trading Company, the sales and marketing arm of De Beers.
The application process set by De Beers is more complex than Diavik or BHP, said Bies, adding Arslanian already submitted a comprehensive business plan following the Snap Lake announcement.
The company is expecting to hear in November if that application was successful.
Arslanian will apply for selection as a purchaser of Gahcho Kue diamonds as well.
"We're not the only approved manufacturer in the NWT, but we're hopeful we'll get as much as we can from De Beers," said Bies. "We're interested in manufacturing whatever they can provide us."
There are two other diamond cutting and polishing factories in Yellowknife in addition to Arslanian - Laurelton Diamonds, owned by Tiffany & Co., and the Polar Bear Diamond Factory.
A fourth factory, Canada Dene Diamonds, closed last year.
NWT diamond manufacturers will be selected to purchase Gahcho Kue diamonds based on ability to add value to and market the diamonds effectively, financial standing and adherence to ethical business practices, said Cathie Bolstad, manager of public and corporate affairs for De Beers Canada's NWT projects.
"Later this year, the Diamond Trading Company will select its (clients) for the next contract period, which is a three years purchasing period," said Bolstad.
NWT Industry Minister Brendan Bell commended De Beers Canada for the agreement reached regarding Gahcho Kue's rough diamonds, adding that it would help to build a sustainable local diamond cutting and polishing industry.
"Our secondary diamond industry is contributing to our region's exports of manufactured goods - enhancing economic diversification," said Bell. "Other benefits include increased revenue for the local retail jewelry industry, and tourism spinoffs."
- with files from John Curran.