Lucara Diamond has discovered the world’s second-largest diamond, a 2,492-carat stone, in Botswana. The rare find is considered a significant event for the diamond market, which has been struggling due to the rise of lab-grown stones and decreased luxury spending. Lucara’s shares rose sharply following the announcement.
Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.
By Harry Dempsey in London and Rob Rose in Johannesburg
Lucara chief William Lamb says his company’s rare find provides ‘sparkle’ amid market gloom ___STEADY_PAYWALL___
The world’s second-largest diamond has been unearthed in Botswana, providing some reprieve for a sector devastated by the rise of lab-grown stones.
The 2,492-carat stone, discovered by Canadian mining company Lucara Diamond, is the biggest known gem-quality find after the Cullinan diamond, discovered more than a century ago, which was cut up and incorporated into the British Crown Jewels.
“This is a once-in-hundreds-of-years event, and an absolute geological phenomenon,” said Clifford Elphick, a former executive of the world’s largest diamond company De Beers, who now runs his own mining companies in southern Africa. He added that the find was “the most significant of this century”.
People close to Lucara estimate the stone could be worth upwards of $40mn. The company’s share price jumped by about 40 per cent on Thursday.
William Lamb, Lucara’s chief executive, told the Financial Times the find was “a sparkle in a gloomy market” and vowed to use the stone to boost the profile of the diamond sector and Botswana.
Factory-made diamonds and the downturn in luxury spending have rocked the rough-diamond market, pushing Anglo American to sell De Beers, the world’s largest producer by value. But giant discoveries remain a vital source of income and marketing power.
“The challenge we sit with is a stone like this needs to be used to drive interest in the diamond market,” Lamb said.
Botswana’s president Mokgweetsi Masisi was presented with the stone on Thursday. Diamonds have formed the bedrock of the southern African country’s prosperity, with mining of the precious gems making up about a quarter of its GDP, according to the IMF.
The stone, which is two-thirds the size of a drinks can, came from Lucara’s Karowe mine, which has been the source of several other big finds including the 1,758 carat Sewelô and the 1,109 carat Lesedi La Rona.
It was found using X-ray transmission technology installed eight years ago after the Lesedi La Rona was damaged in the plant’s mill when it was found.
Diamonds are typically valued based on properties known as the 4Cs: colour, clarity, cut and carat weight.
The stone, which still needs to be examined for its quality, is so big that it cannot be analysed using conventional equipment.
Lucara sold the Lesedi La Rona, a tennis-ball sized white diamond, for $53mn in 2017, although the value that can be secured depends heavily on a gemstone’s colouring.
Lamb said that a sales agreement with Belgian diamond polisher HB Antwerp, which covers all gems above 10.8 carats, had an exemption for “legacy” stones worth above approximately $10mn.
Buyers could include private collectors or jewellery houses. Lamb ruled out Sotheby’s auctioning the stone and singled out luxury groups Louis Vuitton, Bulgari, Tiffany, Chopard and AndreMessika as potential buyers.
The most expensive diamond ever sold at auction was the Pink Star in 2017 for $71mn. Large stones can be difficult to sell because of their uniqueness, the limited number of buyers and difficulty valuing them.
Raj Ray, an analyst at the bank BMO, warned that marketing had to be handled carefully to maximise the stone’s value.
“The diamond sector is what it is. But for Lucara, this is a very positive outcome,” he said.
© 2024 The Financial Times Ltd.
Bloomberg: Second-Biggest Diamond Ever Is Found in Mine in Botswana
By Paul-Alain Hunt and Thomas Biesheuvel
A massive 2,492-carat diamond — the second-largest stone ever unearthed — has been recovered from a mine in Botswana.
The stone, found at the Karowe mine that’s run by Canada’s Lucara Diamond Corp., is yet to be thoroughly assessed and it’s unclear whether it will yield the highest-quality gems. But it’s not that much smaller than the 3,106-carat Cullinan Diamond, the world’s largest, which was discovered in South Africa almost 120 years ago.
Lucara’s Karowe mine is famous for giant stones. In 2015, Lucara found the 1,109-carat Lesedi La Rona, which at the time was the second-largest ever and eventually sold for $53 million. The mine has also yielded an 813-carat stone that fetched a record $63 million. Those two gems were both Type-IIa, the most prized stone.
The miner also previously recovered the 1,758-carat Sewelo at Karowe, but that was not a gem quality stone.
Even if the diamond does not turn out to be gem quality, recovering such a big stone will be a major boost for Lucara. The find was made using x-ray technology installed at the mine to identify high-value stones in the primary ore body.
That shows Karowe’s plant can process and detect huge gems without breaking them, a consistent headache when trying to separate brittle stones from hundreds of tons of waste rock.
“The ability to recover such a massive, high-quality stone intact demonstrates the effectiveness of our approach to diamond recovery,” Lucara Chief Executive Officer William Lamb said in the statement.
The biggest diamond ever discovered is the Cullinan, found near Pretoria in South Africa in 1905. It was cut into several polished gems, the two largest of which — the Great Star of Africa and the Lesser Star of Africa — are set in the Crown Jewels of Britain.
Lucara’s discovery comes amid a collapse in diamond prices as the industry faces headwinds in nearly all its major markets. That has been compounded by too much supply and growing erosion in some categories from synthetic stones.
Read also:
- Unveiling the extraordinary life of Harry Oppenheimer – diamonds, gold, and a legacy defined by power and politics
- SA’s third big Jackpot: First Diamonds, then Gold, now it’s Oil from West Coast, Karoo – Lorimer
- 🔒 Diamonds in the rough: The FT chats to De Beers CEO Al Cook
© 2024 Bloomberg L.P.
