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To: E. Charters who wrote (91684)	12/8/2002 12:24:45 PM
From: Richnorth	Read Replies (1) \| Respond to of 116753

Very interesting. You seem to be knowledgeable and quite up to date on the chemistry of kimberlite-bearing rocks and other related stuff. By the way, for years GMD had been exploring for kimberlites and diamonds on the Royce properties in the NWT. While the till samples that De Beers extracted were very promising in terms of garnets, G10s and pyropes etc, De Beers somehow failed to interpret them and to discover their source. De Beers gave up! BHP took over briefly: as it turned out, BHP was interested only in making a flyover in an attempt to garner more meaningful data. Have you any info or comments on GMD's Royce properties? The latest I heard is that they have not given up.

To: E. Charters who wrote (91684)	12/10/2002 4:49:47 AM
From: E. Charters	Respond to of 116753

I think it germane to mention that Canada is now number 6 in production of gem diamonds in the world. In 1993 we in Canada produced exactly no diamonds at all. That was the year that Charle's Fipke's Diamet came out with the news announcement that is had found 89 diamonds in core at a place called Point Lake NWT, Canada. There, 39 years before a geologist working for the Geological Survey of Canada had found rock on the surface that he misidentified as ijolite. In fact we now know by its major element chemistry that the rock he found was a Kimberlite, the sole at-that-time-known, host rock for diamonds. Few if any geologists in Canada at that time had ever identified or even seen a Kimberlite. Certainly they did not have a familiarity with the rock on a day to day basis. If the Kimberlite identification been made at that time, and a knowledgeable test for pyrope garnets done, it might have changed Canada's history significantly. As it was, the Russian Geological Survey did their preliminary research work correctly at that same time, ejected the South Africans from their country for their interference and false information, and proceeded to find a resource of diamonds near the Yakuts river that would make Russia the premier producer of gem diamonds in the world. Later, in the 1980's one of our geologists with a South African's Geologist's (the late Hugo Dummet) help and knowledge and an oil company's money, (Superior Oil) began the eight year trek across Canada's north that culminated in the finding of Diamet Mineral's of one of the richest diamond resources ever found. Diamonds produced from mines are almost completely gem diamonds. There is some production of industrial diamonds from mined deposits, but 90% of all industrial stones are now artifically made. By far the best artificial stones, almost double the quality for abrasive purposes of the domestic ones made by GE, are made in Russia. After Fipke's discovery the stock of Diamet went, over the course of a year, from 1.00 to 65 dollars a share. The richest pipe in total production in the world is the Premier mine in South Africa. Compared to the Canadian Mine the Diavik, the Premier is of indifferent grade, producing about 0.35 carats per ton. It does however produce large diamond ofgood gem value. In 100 years it production has totalled 100 billion dollars. The Diavik's grade by comparison is almost 3.0 carats per ton. Its diamonds while not as large are of very good quality. I have seen a few from this diamonds from this "new" deposit and they are of startling beauty and of pristine condition ( degree of clarity, inclusions and surface defects). So far the Canadian deposits while of large number, and spectacular grade, are of relatively small size. At one million tons of ore removed for year, the Diavik has I believe only a 20 year life span, giving perhaps a paltry 8 billion dollar total cash flow from one pipe. The company itself has a few more pipe that it may produce from however. What DeBeers has done, with alarming expertise and finesee in Canada and the States since 1963 and particularly since 1993, is disseminated misinformation to the investing public and proceeded to take over the comapanies that have diamonds discoveries in Canada. So far the have bought up the Diavik, Winspear and Mountain Province all of which have good finds. There are others as well that they control. The whispering campaign is that it is fruitless to compete and impossible to sell the product if you are an independent because DeBeers controls the world cut and rough diamond trade by the influence of its control of the diamond Cartel, the CSO in Enlgand. So the investor, seeking to evaluate Canada's junior stock discoveries is left with very little information he can depend on. If the Russian government believed what the Canadian and US investor is fed, they would sell no diamonds at all into the rough stone market. In fact they sell one billion dollars worth of rough stones a year. Contrary to what the investor has been led to believe, the sale of rough stones by a diamond mine into the market is a business that has a profitability of 80% on the average and has proven, over the last hundred years to be the most profitable business ever devised, surpassed perhaps only by historic placer gold mining in California, magazine pornography and domination ofthe PC operating system by Microsoft. It stands to reason that DeBeers would want this rough stone profitability relationship despite the cut stone trade garnering 10 time the retail value of the wholesale rough stones. The retail is all high-expense cutting and marketing with several layers ofmarkup and a vast support cartel buying and holding product for years. The rough stone market must support the investors and the production of profit from the mines. The mine must sell its stones as it produces them, and make profit. To run the mines at cost would make no sense. They are separate from the CSO and need operating capital and investment return. In fact costs per ton of bulk rock mined is a fraction of the rough diamond value produced therefrom. To mine rock and mill it from an open pit mine takes anywhere from 5 to 20 dollars CDN per ton. In a mine like Diavik, the three carats of gem diamonds are worth on an average about 135 dollars a carat for each and every mined carat(no matter how small some of the stones are). That is hefty profit. Even if the stones mined were low grade river stone as in the Congo, where they average 8 dollars US a carat, the Diavik would still make money on bulk mining methods. EC<:-}