Tiffany Will Cut Diamonds in Canada

October 3, 2002

Tiffany Will Cut Diamonds in Canada

Tiffany & Co. plans to cut one quarter of its share of diamonds from the Canadian Diavik diamond mine in a new $3 million, 12,000-sq.-ft. facility in Yellowknife, Northwest Territories. Diavik, scheduled to open in early 2003, is in the Northwest Territories, north of Yellowknife. Diavik is owned by Britain's Rio Tinto and Canada's Aber Diamond Corp. Tiffany, of New York City, owns 14.7% of Aber and has a 10-year purchase agreement, signed in 1999, to buy a minimum of $50 million a year from Aber's share of Diavik's diamonds.

Diavik and Australian-owned BHP-Billiton's Ekati diamond mine, located near Lac de Gras in the Northwest Territories, are expected to produce more than 10% of the world's diamonds, which will make Canada the third-largest producer worldwide, after Botswana and Russia. South African mining giant De Beers also is planning to open a mine near Ekati and Diavik in 2006.

Tiffany's new cutting facility will be a first for the retailer, which has the rest of its diamonds cut in Belgium, Israel and the U.S. It will join three other Canadian cutting factories. The facility will initially train 20 local cutters using experienced professionals from outside Canada, it says. Tiffany says the number of Canadian cutters could grow to 75. The retailer plans to market the diamonds under its own brand name and not use the "Made in Canada" branding effort developed by the Northwest Territories for diamonds cut and polished there.

by Peggy Jo Donahue

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