Online jewelry retailer Arctic Blue Diamonds has purchased an 89.7% stake in a Canadian exploration project with indicated rough-diamond resources of 18.2 million carats.
The WO Diamond Project, located in the Northwest Territories, encompasses eight mining leases covering 5,815 hectares, Arctic Blue said Wednesday. It’s approximately 23 kilometers from Rio Tinto’s Diavik mine and 53 kilometers from Burgundy Diamonds’ Ekati mine. The jeweler purchased a 72.1% interest from De Beers Canada subsidiary Peregrine Diamonds and a 17.6% stake from Archon Minerals.
Arctic Blue, which sells Canadian fluorescent diamonds through its online site, has acquired marketing rights to all future production at WO, it explained. An independent mineral resource valuation released in 2008 estimated the rough at $72 per carat. However, based on updated prices, the jeweler believes the diamonds contained in the WO project are now worth $90 to $100 per carat.
Arctic Blue intends to use either existing diamond-recovery facilities and processing plants at other mines in the area that are less than a few years away from their end of life or to build a factory in the Yellowknife area, close to the site, according to CEO Patrick Evans, formerly the chief of Dominion Diamond Mines, which used to own Ekati.
Currently, the WO project is on care and maintenance. Until it is brought back online, Arctic Blue will perform environmental, geological and engineering studies at the site to assess development opportunities, it added.
Image: Fluorescent diamond jewelry. (Arctic Blue Diamonds)