Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Luxury jeweler and watchmaker Harry Winston Diamond Corp said today that production at its Diavik mine in Canada’s Northwest Territories was up about 19% in the first quarter on improved grades.
The Diavik mine, which is operated by Rio Tinto Plc , produced 1.60 million carats of diamonds in the quarter.
Average grade increased to 3.0 carats per tonne from 2.8 carats per tonne, a year ago, said the company, which gets 40% of output at Diavik.
The company continues to see production of about 8.3 million carats from the mine this year, up from 6.7 million in 2011.
Do Diamonds have their days counted?
The world of diamond mining is undergoing fundamental changes.
The third largest miner, Rio Tinto, announced in late March that it was reviewing its diamond business, potentially selling it all off.
Other than Diavick, Rio Tinto operates other two diamond mines including Argyle in Australia and Murowa in Zimbabwe. The miner also has an advanced diamond project in Bunder, India.
Rio Tinto followed BHP Billiton, the globe’s biggest mining company, which in November launched a review of its diamond operations with an eye to selling assets including Ekati.
Apart from BHP and Rio changing strategy, the founding family of De Beers last year sold out completely from the company most closely associated with the gems after three generations steering the business.
Russia’s Alrosa overtook De Beers in 2009 as the world’s number one supplier of rough and after decades of being a secretive state-owned organization is in the process of readying a global public offer.
Image of Diavik by Trevor MacInnis at the English Wikipedia project.
