Gem Diamonds Recovers 126 Carat, High-Quality Stone in Lesotho

Mining and Exploration
06/07/2017 09:28

Gem Diamonds Limited has recovered yet another exceptional rough stone, this time a high quality 126 carat, D color Type IIa diamond, from the Letšeng mine in Lesotho. After a bit of a dry spell in 2016, Letšeng mine has now yielded three +100 carat diamonds in the last month alone, including the recovery of two high quality diamonds in June 2017: a 104.73 carat diamond and a 151.52 carat yellow diamond. The mine has consistently yielded the highest price-per-carat diamonds of any mine in the world due to their size and exceptional quality. Gem Diamonds is a 70% owner of the Letšeng mine.

Nonetheless, the company is coming off a difficult year in 2016. Revenue fell 24% to $190m from $249.5m as the average value per carat achieved from diamonds from Letšeng tumbled 26% year-on-year to $1.695 from $2,299 a year earlier, while the group also recovered fewer +100 carat diamonds (5) compared to 2015 (11). Last March, Clifford Elphick, Chief Executive of Gem Diamonds said, "Demand and prices achieved for the large, high quality diamonds recovered from Letšeng have remained firm, but the decline in 2016 in the recovery of diamonds larger than 100 carats has had a disappointing impact upon revenue and cash flow." The company is hoping its latest discoveries are the sign of a new trend. At the start of the second quarter, they shifted operations to the higher-grade K6 portion of the mine's main pipe, and the recovery of three large D-color, type IIa rough diamonds followed: 80.58 carats, 98.42 carats and 114 carats. Then in June they recovered the two large stones mentioned above. The company's Trading Update for the first half of 2017 is due out at the end of the month.