BUSINESS APR 28, 2023 – 8:30 AM EDT
Colourful diamonds surface near Naujaat
Orangey-yellow gems could point to valuable deposit but more work needs to be done, North Arrow CEO says
There are five active diamond mines in Canada: three in the Northwest Territories, one in Ontario and one in Quebec.
Could the small hamlet of Naujaat, population 1,225, become home to the sixth?
It’s too early to start setting up shop, but the recent discovery near the community of two rare diamonds boasting a unique orange-yellow colour means there’s a glimmer of possibility that a diamond mine could be built.
The 0.31- and 0.21-carat rectangular, radiant-cut diamonds were pulled from an 1,800-tonne bulk sample deposit done in 2021 by North Arrow Minerals, nine kilometres northeast of Naujaat in the Melville Peninsula.
These two rare gems — the largest and best-quality ever found in Naujaat — were cut and polished earlier this year at Burgundy Diamond Mines’ facility in Perth, Australia, as part of an ongoing evaluation of the diamond potential of the site, said North Arrow Minerals president and CEO Ken Armstrong.
“The polished yield of both diamonds is approximately 38 per cent, which is a significant improvement over past polishing efforts, and the 0.31-carat stone is well over twice the weight of previous fancy colour polished diamonds from the deposit,” he said.
What makes these two diamonds so special is not their size, but how saturated their orangey-yellow colour is.
“They’re not, in the grand scheme of things, terribly big, but they are what they call ‘fully saturated’ — the colour is just as intense throughout the diamond,” Armstrong said.
Yellow diamonds are usually larger than the ones found in Naujaat and have a softer, more lemon-yellow shade. The Naujaat diamonds display a deep yellow colour on a small scale.
“They need the diamond to be a bit bigger in order for the light to stay inside the diamond for a bit longer to pick up that colour and bring it back to your eye,” Armstrong said.
“It’s really rare to get that colour in those small diamonds.”
While lab-grown coloured diamonds are common, coloured diamonds found in nature are rare.
Armstrong said it’s difficult to determine the exact monetary value of the diamonds but they’re worth a “magnitude higher value” than a white diamond of the same size and clarity.
“If, for example, you had a white diamond that is worth a thousand bucks, these would be $10,000,” he said.
These two diamonds likely aren’t worth quite that much money, he said, but that comparison in price emphasizes the value of these orangey-yellow diamonds.
North Arrow Minerals will send the diamonds to the Gemological Institute of America, based in California, to be certified as natural diamonds with a Coloured Diamond Grading Report, which distinguishes them in the market from lab-grown, and to help determine their value.
As for a possible Naujaat mine, Armstrong said it’s much too early to know if one could be economically viable.
Diamonds are found in kimberlite, a rock that comes from ancient volcanoes 150 to 450 kilometres beneath the earth’s surface.
Kimberlite pipes, which are vertical structures in the Earth’s crust, are what transport diamonds to the planet’s surface.
“[It’s] really the only mechanism that can transport the diamonds from the Earth’s mantle up to the surface where we can find them,” Armstrong said.
A feasibility study can’t be done until North Arrow Minerals determines how much kimberlite is in the ground.
In the meantime, the company hopes to pull another larger deposit of around 10,000 tonnes, but will have to work with Burgundy Diamond Mines to come up with a financial plan to collect the bigger sample.
“That’s expensive, and we need to figure out how that could be funded,” Armstrong said.
“Obviously, it’s not a slam dunk or we’d be charging along.”
Still, the distinctive nature of the rare gems has Armstrong and his team keenly interested in continuing exploration of the Naujaat site.
“We think that there could be enough value, just with these coloured diamonds, even though they’re a very small component of overall diamond population in this deposit,” Armstrong said.
“We think there’s enough that it could make the project work, but only if there’s enough that are of high enough quality.”
So who knows, a Naujaat mine could be a diamond in the rough.
