Precious blue diamond recovered in the Northern Territory

Published at Dec 15, 2016, in Small Caps

Blue diamonds are rare and highly sought after, as was proven last month with the sale of a ‘Sky Blue’ diamond in Geneva for just over $17 million.

In less than a month since mobilising its mining fleet in the Northern Territory, Australian diamond explorer Merlin Diamonds (ASX:MED) has recovered a rare blue diamond.

MED’s Kaye open pit diamond mine is still in its early stages, having only recently completed a dewatering process of ore that was stockpiled prior to the wet season.

The discovery of a rare blue diamond within a month of the mine going into production indicates more discoveries may be imminent.

Blue diamonds are one of the rarest diamond colours, usually commanding prices greater than pink diamonds. In June, a 24.18 carat diamond called the ‘Cullinan Dream’ fetched US$25.3 million at an auction in New York.

The blue diamond recovered by MED in the NT was relatively small in size (0.124 carats), however it could serve as a demonstration of the potential for valuable coloured diamonds to be sourced from the site.

MED has stated that the diamond-bearing kimberlite rock at the Kaye pit was ‘rippable’ with a bulldozer, enabling extraction without the need for capital intensive drilling and blasting operations.

The company advised last month that 16,000 tonnes of ore had been mined to date and that it would continue treatment activities throughout the wet season by treating ore from the stockpiles and ramping up diamond recovery operations.

It is due to provide a diamond recovery update in the next quarterly report.

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