Canada aims to be diamond giant: Pettigrew
Could become world's third-largest producer by 2006, industry says
CONSTANT BRAND
ASSOCIATED PRESS
ANTWERP, Belgium — Canada aims to become one of the world's largest diamond producers, Trade Minister Pierre Pettigrew said after meeting today with diamond officials in the world's top gem trading city.
Canada, widely known for its export of natural resources like softwood lumber and oil, doesn't have a reputation for diamond mining, but recent finds in the Northwest Territories over the past decade are starting to turn heads in the diamond industry.
"We are optimistic ... to become one of the greatest players," Pettigrew said after meeting with Peter Meeus, managing director of Antwerp's High Diamond Council, which handles 80 per cent of world trade in rough diamonds and half of trade in cut gems.
The city's diamond cutters, eager to get a cut of the action, will handle over 95 per cent of all Canada's rough and polished gems in deals signed over the past few years.
Pettigrew, who came to Antwerp with representatives of Canada's diamond industry, said he's optimistic his country could soon find itself rivalling Botswana, the world's top producer, and Russia.
So far, the numbers point to a rise in Canada's fifth-place rank in production, just behind Angola and South Africa, as a second, larger diamond mine at Diavik, N.W.T., starts shipments to Antwerp in March.
"There is a phenomenal potential for Canadian diamonds," Meeus said. "We live in a new diamond world, there are new producers out there," he said.
If mining continues on schedule, Meeus said, Canada will double its world market share of rough diamonds to 12 per cent by 2006.
Diamond industry officials have said that with an additional third mine at Snap Lake, N.W.T., run by diamond giant De Beers, likely to start production in 2005, Canada will become the world's third-largest diamond producer, worth more than $1 billion (U.S.) a year and 17 per cent of the market after 2006.
To date, only one mine has started shipping gems to Antwerp: Ekati, a mine about 300 kilometres northeast of Yellowknife, the territorial capital, run by Anglo-Australian mining giant BHP-Billiton.
It opened in 1998 as Canada's first diamond mine and has shipped diamonds worth about $419 million (U.S.) into Antwerp, which cuts, polishes and resells them to jewellers and wholesalers.
"These deposits produce some of the highest-quality diamonds, as Russia does," said Bob Cannicott, CEO of Aber Diamond Corp. (TSX: ABZ) of Toronto, which along with Rio Tinto PLC of London jointly run the $1.3-billion (U.S.) Diavik mine. That mine is 400 kilometres the north of Yellowknife.
Cannicott said he expects Diavik to produce around five per cent of the world's diamond supply when it starts production in just over a month.
Pettigrew said he's pleased with joint co-operation and training programs set up with Antwerp's High Diamond Council, which is training about 70 specialist cutters in Yellowknife.
World diamond seller Tiffany & Co. has also made plans to build a diamond cutting and sorting plant in Yellowknife, to coincide with the opening of the Diavik plant, from which it will buy about $50 million worth of high-grade gems per year.
Pettigrew said the diamond industry is providing vital jobs for the aboriginal population, which has suffered for years under high unemployment. There are more than 30 exploration projects underway.
The Belgians are keen to promote diamonds from Canada as they try to clean up the $7.8-billion diamond industry's tarnished image, saying they are winning the battle against smugglers who use gems to fund African wars.
Stung by the bad publicity, major trading centres introduced new rules in 2000 to track the origin of diamonds and stamp out illicit trading. Together with peace accords in the affected African countries, the rules have reduced gems-for-guns smuggling. |
