Juina's Tropical Diamonds
Diamonds nestled deep in the Brazilian Mato Grosso promise abundance
After a century of fits and starts, Brazil is muscling in on organized
diamond mining again. A source deep in the jungles of the state of Mato
Grosso, once a De Beers concession, is producing marketable quantities of
colorless diamonds as well as pinks, reds, browns and a few blues.
Steve Issod and Airton "Tito" Reis founded the project. Then
Juina Mining Corp. was formed as a public company in Reno, NV, to mine the
site. Noel Frenzell was hired as president, and Issod remains a consultant.
Mining began in January on a 2,471-acre site in Mato Grosso's Airpuana
Juina Province. Called "Property 1,000," the site is part of the
Guaporé Shield of the Amazonico Craton, a geologic feature conducive
to the formation of diamond-bearing kimberlites. JMC projects potential
reserves valued up to $200 million. Annual production is expected to reach
720,000 carats this year and 3 million carats when the mine is fully operational.
One test in July 1998 yielded an ore sample with 94 diamonds ranging
from 0.50 to 5.23 carats and totaling 112.4 carats. At last year's end,
Issod broke down the material: 10%-12% is bort (low-quality diamonds not
used in jewelry), 60% is near gem and 20%-25% is gem quality. Five percent
is larger diamonds (some over 20 carats) and some fancy colors.
Who will market the diamonds in the long-term wasn't decided at press
time. "We want to make sure manufacturers and dealers are assured of
profits so they will remain as customers," says Issod. Meanwhile, JMC
will distribute through Indian, Israeli and Antwerp brokers on a commission
Past and Future
Diamonds were discovered in Brazil in 1727. The country quickly became the
world's largest diamond exporter until diamonds were discovered in South
Africa in the 1870s.
In this century, Brazil's production became sporadic, mostly because
of lack of control at the mines and political uncertainty.
In the 1970s, De Beers, through MineraVao Itapena S.A. of Brazil, bought
the mineral and mining rights to what is now the JMC property and others.
That effort was hampered by a corrupt Brazilian economic structure and a
flood of unruly independent miners, called garimpeiros.De Beers pulled
out in 1986.
Today, Brazil is the sixth-largest diamond producer, though exact figures
are hard to come by official exports don't account for local consumption
and smuggling. Of the estimated 1.5 million carats of Brazilian diamonds
on world markets since 1983, garimpeirosuncovered several large ones,
including a 280-ct. diamond in 1987 and a 452-ct. diamond in 1994, as well
as fancy colored diamonds.
In recent years, Brazilian mining codes, government control and the investment
climate have improved. Issod says chief geologists from other unnamed mining
companies have expressed interest in the region.
by Robert Weldon, G.G.
Copyright © 1999 by Bond Communications.