This marks the sixth diamond over 100 carats discovered at the Letšeng mine this year, highlighting the mine's continued success in producing high-value gemstones.
Recovered on May 28th, the 212.9-carat diamond is a Type IIa, the most valued and collectable category of diamonds, known for containing very little or no nitrogen atoms in their crystal structure. This latest discovery has led to an 8% rise in Gem Diamonds' shares.
The Letšeng mine, which Gem Diamonds owns 70% of, is one of the world’s ten largest diamond operations by revenue and the highest dollar-per-carat kimberlite diamond mine globally. Located at an elevation of 3,100 meters (10,000 feet) above sea level, it is also one of the world’s most elevated diamond mines.
Despite the recent discovery, the diamond mining industry is facing challenges due to weak demand for diamond jewellery in the US and China and the rising popularity of cheaper, laboratory-grown diamonds. In 2015, man-made diamonds were barely present in the market, but by last year, they accounted for more than 10% of the global diamond jewellery market, according to industry specialist Paul Zimnisky.
The market values of small to medium diamond mining companies, including Canada’s Lucara (TSX: LUC), South Africa’s Petra (LON: PDL), and Gem Diamonds, are around $100 million or less. This is only about a third or a fourth of the price the large stones they aim to find may be worth.
In early trading, Gem Diamonds' stock was up 1.01p at 13.51p, reflecting the positive market response to the latest significant find at Letšeng.
