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FANCY COLORED DIAMONDS

Argyle hero stones

WITH MINE NOW SCHEDULED FOR CLOSURE,
ARGYLE’S 2019 FANCY COLOR TENDER LIKELY TO BE ONE OF LAST

As it does each year, in July Rio Tinto unveiled its 2019 Argyle diamond tender collection of fancy-colored diamonds, extracted at the diamond mine of the same name in Western Australia. Totaling 64 stones and weighing 56.28 carats, this year it includes three extremely rare fancy red stones.

The 2019 Argyle Pink Diamonds Tender collection, which has been titled “The Quest for the Absolute,” includes six of what the company calls Hero Diamonds: the Argyle Enigma, a 1.75-carat modified-radiant fancy red diamond; the Argyle Amari, a 1.48-carat heart-shaped fancy vivid purplish pink diamond; the Argyle Elysian, a 1.20-carat modified cushion-shaped fancy vivid pink diamond; the  Argyle Verity, a 1.37-carat oval-shaped fancy vivid purplish pink diamond; the Argyle Opus, a 2.01-carat round-shaped fancy intense pink diamond; and the Argyle Avenoir, a 1.07-carat oval-shaped fancy red diamond.

The collection is being showcased in Perth, Hong Kong and New York, with bids closing on October 9, 2019.

“These diamonds, each a natural treasure, are a testament to the enormous range and depth of offering from the Argyle ore body, nearly four decades from when production commenced,” said Rio Tinto’s Copper and Diamonds chief executive Arnaud Soirat at the preview of the collection in Perth.

As it so happens, it also likely to be one of the last Argyle diamond collections to see the light of day, because Rio Tinto has also just announced that it will be closing down the Argyle mine before the end of 2020, after finally exhausting its supply of economically viable rough merchandise.

WORLD’S LARGEST PRODUCER, BUT MAINLY LOW-QUALITY GOODS

Since open-pit mining commenced at the Argyle diamond mine site almost 41 years ago, the facility has developed into the best-known source of pink diamonds, producing about 90 percent of the amount mined worldwide.

For a long period the mine was the world’s top diamond producer by volume, but more than 75 percent of output is comprised of lower-value brown diamonds, with its goods selling for an average of $15 to $25 per carat, which is considerably below the $171 per carat average price realized in 2018 by De Beers, for example.

The final production from the Argyle is expected to be sold by 2023, two years after the cessation of activity at the mine, removing some 14 million carats per year from total worldwide supply, which in 2018 stood at about 148 million carats. It is likely to only be partially be offset by the addition of new mines.

The closure of the mine will remove three-quarters of Rio Tinto’s diamond production, but it is unlikely to make much of a dent on the company’s earnings. Diamonds currently account for only 2 percent of the corporation’s revenues. Iron ore, in contrast, ⁠makes up nearly 60 percent.

The Argyle Enigma, a 1.75-carat modified-radiant fancy red diamond.

A bird’s eye view of the Argyle mine in Western Australia.

A MINE THAT REWOTE THE HISTORY BOOKS

Argyle was a mine that rewrote the diamond history books.  The search for diamonds in Western Australia had begun in the early 1970s, and a breakthrough was made when a geologist by the name of Ewen Tyler followed up on a theory that lamproitic minerals found in the Kimberley region of Western Australia strongly resembled the kimberlitic ore that accompanies diamond discoveries in South Africa. It should be noted that the region in Australia is unrelated to the city of the same name in South Africa.

By early 1974, indicator minerals and diamonds had been found in samples from the north, east and west Kimberley area. In July 1976 a diamond of more than a quarter of a carat was found in the King George River in the north Kimberley. Around the same time a diamond-bearing pipe – Big Spring No 1 – was discovered at the remote site of Mt North Creek.

Bulk testing of the Big Spring pipe and four others found nearby in 1977 revealed diamonds of only very small size. It also confirmed the theory that lamproite was indeed a host rock for diamonds in Western Australia.

Open pit mining commenced in December 1985 and while the diamonds unearthed were of much lower value than world average, the volumes were immense, and the grade (number of carats per ton) was the highest ever recorded.

Argyle became the world’s single largest producers of diamonds, as well as the most significant supplier of natural colored diamonds – champagne, cognac, blue and the highly coveted pink diamonds.

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