Africa-focused miner Gem Diamonds (LSE: GEMD) has unearthed a new major Type II white diamond at its prolific Letšeng mine in Lesotho, barely six days after the previous find.
The 118.74-carat diamond is the fifth stone of more than 100 carats recovered this year at the operation, the company said.
Type IIa diamonds are the most valued and collectable precious gemstones as they contain either very little or no nitrogen atoms in their crystal structure. They contrast with boart diamonds, stones of low quality that are used in powder form as an abrasive.
The prolific Letšeng mine is one of the world’s 10 largest diamond operations by revenue. At 3,100 metres above sea level, it is also one of the world’s most elevated diamond mines.
Rough patch
Diamond miners are going through a rough patch as United States and Chinese demand for diamond jewellery continues to be weak and the popularity of cheaper laboratory grown diamonds (LGD) continues to rise.
In 2015, man-made diamonds had barely made an appearance as a competitor to natural diamonds. By last year, these stones accounted for more than 10% of the global diamond jewelry market, according to industry specialist Paul Zimnisky.
The market values of small to medium diamond mining companies, including Canada’s Lucara Diamond (TSX: LUC), South Africa’s Petra Diamonds (LSE: PDL), and Gem Diamonds itself, are around US$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.
Shares in Gem Diamonds rose 8% to close at 9 pence apiece in London on Tuesday, valuing the company at £12.5 million.
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