De Beers in Canada

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Miner to strike it rich in gem sale

FRED BRIDGLAND

http://thescotsman.scotsman.com/international.cfm?id=936572004

AN IMPOVERISHED African miner is set to become a millionaire after unearthing one of the largest diamonds ever found.

The Scotsman can reveal that the 182-carat stone recently dug up by a freelance miner, Mohamed Kalo, in the Aredor Mine in the West African state of Guinea has already been sold to a mystery buyer for more than £5 million, according to sources in Conakry, the Guinea capital.

And Mr Kalo may be about to get very lucky. Guinea’s mines minister, Alpha Mady Soumah, said that, under the country’s minerals and mining laws, the miner is entitled to half the value of the diamond’s initial sale.

The government will receive 7.5 per cent of the sale price under its deal with the Canadian mining company Trivalence.

But the mystery buyer of the as-yet unnamed Aredor diamond may never be known.

"This discovery is thanks to God, who gave me this chance," said Mr Kalo, 20.

The stone, about the size of a fist, was found four weeks ago by the miner, armed only with a shovel. He immediately handed it in to Trivalence.

The corporation mines a 500-square-mile area in one of the most remote parts of Guinea, using a combination of bulldozer draglines with huge buckets plus hundreds of freelance diggers to comb the alluvial deposits. The discovery has caused great excitement at Trivalence’s Vancouver headquarters because the history of diamond mining suggests that when one giant stone has been found, the area inevitably has others.

"Remember that this diamond is at least 60 to 90 million years old," said Judith Kinnaird, professor of economic geology at the University of the Witwatersrand in Johannesburg.

"It was formed in intense heat 100 to 130 miles below the surface of the earth and worked its way slowly to the surface through a kimberlite volcanic pipe.

"The stone is like a work of art. A diamond in its rough state is absolutely unique."

In truth, the diamond is actually little more than a small piece of super-heated carbon.

Yet the Aredor diamond has been under intense guard since Mr Kalo uncovered it in the headwaters of the Niger River. It was flown to Conakry and locked in the vaults of Guinea’s Central Bank. No photographs of the diamond have yet been released.

Freelance discoveries of big diamonds in central and west Africa always trigger frenzied speculation. In this case, Mr Kalo, probably earning no more than the average Guinean’s £325 a year income, had little choice than to hand the stone to Trivalence. It was too big to be slipped into a pocket, or even swallowed, to be smuggled from the mining site. In any case, discovery would have meant a long jail term and even death in one of Guinea’s fetid prisons.

Prof Kinnaird, formerly a lecturer at St Andrews University, said the mystery buyer of the Aredor diamond could do one of two things with the stone.

He or she could keep it in its "mint condition" as an art work and object of value, much as the 616 Diamond, a 616-carat stone discovered at Kimberley, South Africa, in 1876, has been preserved uncut for 128 years.

Derek Schaeser, the curator of the De Beers Museum at Kimberley, where that diamond lies in a vault, said it was so valuable that he was not permitted to put a price on it.

Alternatively, the buyer of the Aredor could send the stone to one of the world’s leading expert cutters crammed into the small network of streets around the Pelikaanstraat in Antwerp, which represent the centre of the world trade in diamonds, to be skilfully cut into several perfectly shaped gems.

"What enhances a stone best of all is the cutting of it," said Prof Kinnaird. "Otherwise the light doesn’t bounce out of the stone, with those flashes of brilliance that really make a diamond."

The biggest rough diamond of all time, the bowling-ball-sized Cullinan, was 3,106 carats and cut into two of the world’s largest gem diamonds, seven other major jewels and about 100 other stones.

Arguably the world’s most famous diamond, the Cullinan was found in an underground mine wall in 1905 in the Premier Mine at Cullinan, 25 miles north-east of Pretoria.

It was sold for £6,250 to the Transvaal government, which then insured it for £800,000 and presented it as a gift to King Edward VII. The stone was studied for several months before the cutter cleaved from it the Star of Africa, a 530-carat jewel that was embedded in the sovereign’s royal sceptre as part of the Crown Jewels.

The second largest stone, the 317-carat Cullinan Two, is embedded in the Imperial State Crown.

Mr Schaeser said the Aredor diamond ranks among the 70 or 80 biggest ever found.

Prof Kinnaird reckoned it probably ranked higher than that.

A spokesman at the Johannesburg headquarters of De Beers, the world’s biggest diamond mining company, said that diamonds are valuable because of their rarity. All the diamonds ever found would not fill a double-decker bus, he said.

If the Aredor diamond is to be cut into several jewels, their ultimate value will depend on a number of factors, said Prof Kinnaird.

First, she said, it will be graded by colour, ranging from blueish whites at the top end to wine-coloured at the bottom.

"Then it must have good clarity. Diamonds get several categories from internally flawless, down to slightly flawed and so on. But skilled cutting adds value most of all."

Prof Kinnaird said that what will excite the Guinea government and Trivalence most of all is the knowledge that other big stones must come from where the Aredor diamond had its birth.

That means the search will be intensified for narrow kimberlite pipes plunging deep down into the earth.

The Trivalence executives in Vancouver will now be feeling they negotiated an excellent deal in 1996 with the Guinean government.

An Australian firm had just pulled out of a 50/50 Aredor deal that had proved uneconomic.

Conakry lured Trivalence into Aredor with a guarantee of 85 per cent of the profits.

With Mohamed Kalo’s find, the gamble has paid off handsomely. And the find will doubtless attract many more poor residents of Guinea to quit their low-paid jobs and head for the mines - in the hope of following in the footsteps of Mr Kalo.

DIAMONDS ARE FOREVER

• Diamond is simply carbon - just like charcoal or graphite. The difference is caused by the bonding between adjacent atoms to form a diamond’s unique crystalline structure.

• Diamonds have been known for at least 3,000 years and were first mentioned in the Bible.

• It is thought the earliest diamonds were found in about the 12th century BC in India, which remained the most important source until 1725, when diamonds were discovered in Brazil.

• The Indian and Brazilian deposits had been almost exhausted when, in 1866, the Eureka diamond was discovered in South Africa.

• The world’s most famous diamond, the Cullinan, was found in 1905 near Pretoria. It was sold for £6,250 to the Transvaal government.

• Through promotion from the De Beers Company and the Diamond Promotion Service, diamonds have become the most desired gemstone.

• Diamonds Are Forever (1971) was Sean Connery’s last Bond film as a young 007. Bond investigates a diamond smuggling operation in Amsterdam but stumbles across a more sinister plot hatched by Blofeld to use a laser in space to cause world mayhem.

ROB TOMLINSON