Newfield has started digging up diamonds in Sierra Leone and a good chunk are top quality
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Diamond miner Newfield Resources has started digging up the precious gem in Sierra Leone and is excited about how many gem quality stones it is finding.
The company (ASX:NWF) has so far exported 1626 carats for valuation and at least 48 per cent of them are what is known as “collection goods” — diamonds with top colours in the D to G range.
Colour is the second most important characteristic of a diamond after the cut.
The highest quality diamonds are colourless, while lower quality diamonds have noticeable colour that appears as pale yellow.
Diamonds rated D to G are known as white diamonds. D diamonds are very rare and colourless, while G diamonds are near colourless.
Independent diamond analyst Paul Zimnisky predicts global consumer diamond demand will grow a nominal 3.5 per cent in 2019, a moderate decline from 2018 estimates of 4 per cent.
He told Stockhead the year-over-year decrease is due to expectations that corporate earnings growth in the US — the diamond industry’s largest consumer market — will abate and trade tensions as well as other geopolitical uncertainties will weigh on economic growth.
But at the same time the global production of natural diamonds is forecast to drop by 2.8 per cent to 145 million carats in 2019.
Newfield said some 2000 carats have been recovered from the processing of stockpiled bulk samples from its Tongo project.
Over 80 per cent of those were sent to the world’s major diamond hub, Antwerp, for assortment and valuation.
Diamond miners like to sell their products via international commercial tender in Antwerp to get the highest price.
Last year another Africa-focused diamond miner, Lucapa, held back a bunch of its best sparklers from sale until the Angolan government passed new laws allowing diamonds to be sold through international tender.
Previously diamonds had to be sold through a central state-owned government agency.
Lucapa is this month undertaking a competitive bid sale of diamonds from its Lulo project following the change of laws.
These are the first diamonds to be offered for sale through international tender under the Angolan government’s new marketing policy.
Meanwhile, Newfield recently received a 25-year renewable mining licence for the Tongo project.
The company has also dug out a single portal entrance to access the high-grade Kundu and Lando kimberlites and has started removing waste material to get to the diamonds.
Drilling and blasting needs to be done to get to the diamonds in the harder material, Newfield said.