DIAMOND SPECIAL — Brazil, Guyana and Venezuela — Southern

Diamonds were first discovered in Brazil in 1725, and the Latin American country soon replaced India as the most important global source of diamonds.

Brazil remained the primary diamond source until the 1890s, when Africa’s diamond production surged ahead.

Production of primary gem-quality diamonds from Brazil

is exclusively from eluvial and alluvial deposits and totaled 2.2 million carats in 1992, valued at US$150 million, reports Jonathan Challis of Vancouver-based C.M. Oliver & Co.

The first kimberlite pipe in Brazil was confirmed in 1969 in the Coromandel district. As many as 14 different kimberlite provinces, containing 500 pipes, have been classified in Brazil.

In the Coromandel area, Southern Copper (VSE) has a 100% interest in 35,000 acres where work has uncovered 16 kimberlite pipes. There could be as many as 40 kimberlites on the claims that follow three separate river systems. One of the rivers, San Antonio de Bonito, is the source of most of the large diamonds found in Brazil; 11 stones greater than 90 carats in size (all of them gem quality) have been documented from the area, including a 602-carat stone uncovered in 1993. These stones have all been recovered from the river gravels and not from the primary kimberlite material.

Diamonds have been produced from these gravels in the area of these pipes for the past 200 years and are still being produced by small operators. Southern Copper is planning an alluvial operation as it continues to search for the primary source of diamonds.

Elsewhere in Brazil, three juniors — Southwestern Gold (TSE), Hillsborough Resources (TSE) and Vector Diamond (VSE) — announced several months ago a planned merger of their interests in the Canabrava project in Minas Gerais state.

Other companies that have acquired, or are negotiating to acquire, diamond property interests in the country include Gold Standard (NASDAQ), KWG Resources (ME) and Lysander Gold (VSE).

Guyana and Venezuela

Toronto-based Exall Resources (TSE) owns the rights to a gold and diamond placer concession on Guyana’s Mazaruni River, where a pilot processing plant for gravels is under construction.

Already active on the gold scene in Guyana, Golden Star Resources (TSE) has gained the rights to explore two areas — Upper Potaro and Upper Mazaruni — prospective for primary diamond sources that the company says may be the origin of alluvial diamond deposits in the area.

In Venezuela, a bulk sample collected this summer from the MIGS II concession yielded diamonds for project partners Solomon Resources (VSE) and Yellowjacket Resources (VSE). Early reports indicated a fairly high gem quality.

Lumina Investment (VSE) reported this summer the acquisition of property in Bolivar state where some areas have undergone mining for alluvial diamonds. Other companies that have acquired, or are negotiating to acquire, diamond property interests in Venezuela include William Resources (ME), Gold Reserve (TSE), Naxos Resources (ASE), Marlat Resources (CDN) and Richlode Investments (VSE).

Active diamond explorers in Canada

Company Exch. Aug. 19/94 Aug 20/93

close ($) close ($)

N.W.T.

Aaron ASE 0.64 2.00

Aber TSE 8.25 3.25

Adex TSE 0.32 0.31

Almaden VSE 1.75 2.10

Atna VSE 0.47 1.25

Aur TSE 3.95 4.70

Barexor ME 0.16 0.34

Bre-X ASE 2.30 0.48

Calco VSE 0.25 0.44

Caledonia TSE 5.88 0.95

Cons. Abitibi ME 0.33 1.25

Cyclone Cap. VSE 1.00 2.20

Dentonia VSE 0.84 5.50

Dia Met A* TSE 17.50 44.00

Dia Met B* TSE 17.75 ….

Etruscan VSE 4.05 2.20

Garden Lake VSE 0.50 2.50

Geomaque TSE 1.40 0.81

Gerle Gold VSE 0.49 0.59

Greater Lenora TSE 2.00 1.30

Horseshoe ASE 0.80 5.50

Island-Arc VSE 0.80 1.20

Jonpol TSE 0.28 0.40

Kalahari VSE 0.90 1.60

Kettle River VSE 1.85 10.13

Layfield VSE 0.47 0.61

Lumina VSE 0.80 1.45

Lytton TSE 2.15 4.85

Mill City VSE 0.87 0.39

New Dolly VSE 1.60 1.00

Noble Peak ASE 0.90 0.75

Noront VSE 0.22 0.28

Pure Gold TSE 0.25 0.54

S. Africa Min ASE 1.25 0.30

SouthernEra TSE 2.55 6.75

Sway VSE 0.47 0.52

Tanqueray ASE 1.45 0.80

Texas Star TSE 1.45 4.70

Teryl VSE 0.32 0.40

Thunderwood TSE 0.42 0.99

Treminco TSE 0.23 0.36

Troymin ASE 0.24 0.59

Tyler TSE 0.25 0.53

Westward VSE 0.61 1.20

Windarra TSE 0.20 0.48

Winslow VSE 0.35 0.95

Winspear VSE 0.85 1.66

Alberta

Cameco TSE 24.50 23.38

Double Down VSE 0.33 0.65

Hixon Gold VSE 0.20 0.40

New Claymor VSE 0.75 1.25

Northside ASE 0.31 0.36

Prime Equities VSE 1.64 4.40

Ridgeway VSE 0.55 0.44

Rich Minerals ASE 0.41 2.44

Takla Star ASE 2.00 1.05

Verdstone VSE 1.08 0.94

Company Exch. Aug. 19/94 Aug 20/93

close ($) close ($)

Saskatchewan

Aaron ASE 0.64 2.00

Cameco TSE 24.50 23.38

Can. Entech ASE 0.08 0.55

Cons. Pine VSE 0.87 2.80

Currie Rose VSE 0.25 0.21

Goldn Marlin VSE 0.33 0.40

Golden News VSE 1.20 1.16

Golden Peaks VSE 0.60 1.20

Guardian VSE 0.75 0.27

Lucky Break VSE 0.18 0.35

Morgain VSE 0.35 0.45

Mountain Pro VSE 0.51 0.61

Northwind VSE 0.21 0.20

Orvana TSE 5.75 3.05

Rhonda ASE 4.75 5.88

Savanna ASE 0.22 0.26

Swannel VSE 0.42 0.35

War Eagle VSE 3.45 1.16

Winslow VSE 0.35 0.95

Manitoba

Northwind VSE 0.21 0.20

Winslow VSE 0.35 0.75

SouthernEra TSE 2.55 6.75

Ontario

Continental ME 0.66 0.90

Cross Lake VSE 0.15 0.15

East West VSE 0.15 0.30

Findore CDN 0.40 0.26

Glencairn ASE 0.50 0.45

Goldhunter ASE 0.21 0.15

Gwen ASE 0.18 0.23

Joutel TSE 0.46 0.50

KWG ME 3.80 3.60

Panthco CDN 0.21 0.90

Regal Gold CDN 2.30 2.60

Strike CDN 0.52 0.27

Spider ASE 0.25 0.17

Sudbury

Contact TSE 16.25 2.20

Tandem ME 0.20 0.26

Texas Star TSE 1.45 4.70

T&H TSE 0.30 0.23

Wheaton River TSE 2.05 1.65

Quebec

Beaufield VSE 0.20 0.65

Eastern Stone ASE 0.11 0.50

Fancamp VSE 0.43 0.24

Garde ME 0.35 0.25

Golden Tag VSE 0.47 0.55

Min du Nord ME 0.25 0.66

Orbite ME 0.23 0.18

Orient ME 0.06 0.09

Storimin ASE 0.17 0.18

William ME 1.00 0.30

Wiscan TSE 0.185 0.25

Vior ME 0.22 0.42

* stock split in 1994 on a 2-for-1 basis, and voting and subordinate-voting shares created