Massive 1,758-Carat Diamond Discovered, Largest in Recent History


Diamond mining companies like to show off their big discoveries to shareholders and the markets alike, as major stone findings are often a good sign that a particular diamond mine still has plenty of potential output in the years to come.

On Thursday, the Canadian-listed Lucara Diamond Corp (TSE: LUC) saw shares jump today as the company announced the discovery of the largest uncut diamond in recent history.

Found in its Karowe mine in Botswana, the company found a 1758-carat diamond that’s bigger than a tennis ball and weighs around 352 grams. The new stone has beat the companies previous record from November 2015, another stone that took them over two years to find a buyer for.

The 1758-carat diamond is second in size only to the famous 3,106-carat Cullinan diamond found in South Africa back in 1905.

“Lucara’s technologically advanced, XRT diamond recovery circuit has once again delivered historic results. Karowe has now produced two diamonds greater than 1,000 carats in just four years, affirming the coarse nature of the resource and the likelihood of recovering additional, large, high quality diamonds in the future, particularly as we mine deeper in the orebody and gain access to the geologically favourable EM/PK(S) unit, the source of both of our record breaking, +1,000 carat diamonds,” commented Eira Thomas, Lucara’s CEO, according to the company’s press release.

Lucara previously discovered the 1,109-carat diamond known as “Lesedi La Rona,” which was recovered in 2015 but failed to meet an undisclosed reserve price at an auction later that year. This wound up exerting downward pressure on company shares. Eventually, the British diamond dealer Graff Diamonds bought the stone for $53 million in September 2017.

For a company like Lucara, which a market cap of C$600 million, major diamond sales such as these represent massive surges in corporate revenues. According to Reuters, Graff ended up producing 67 finished gems from the large stone.

The major find is just one of many in a series of high-value discoveries for the Vancouver-based company. Since implementing their new XRT diamond recovery technology at their Karowe mine, Lucara has recovered 12 diamonds at over 300 carats, including a 472-carat and 327-carat diamond back in April 2018.

The newest stone could sell for as much as $70 to $80 million, with shares spiking significantly in anticipation of such a sale even if it might be years down the road. Lucara’s stock price jumped as much as 11.4 percent on Thursday in the highest move seen in over two months before eventually settling at a 6.3 percent increase by the end of the day.

Shares of the company are currently sitting a C$1.68 per share, a relatively cheap stock for a company of such size. Lucara also has a 5.95 percent dividend yield on shares, also an impressively high figure for a relatively small company.

Small diamond miners have been struggling recently as prices for smaller stones have fallen. With synthetic diamonds also flooding the market, more abundant low-quality stones are becoming harder to sell. Instead, these major discoveries represent major paydays for diamond miners, with the demand for large, high-quality stones remaining strong.