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RAPAPORT... North Arrow Minerals Inc. confirmed that a parcel of 383.55 carats recovered from a bulk sample at the Qilalugaq diamond project returned a value of $36 per carat and a modeled range "possible low" of $43 per carat and a "possible high" of $92 per carat. The diamond valuation was conducted by WWW International Diamond Consultants.
Ken Armstrong, the president and CEO of North Arrow, said, "The diamond parcel recovered from the Q1-4 bulk sample is very small and, as a result, the primary conclusion reached by WWW is that these valuation results and modeled values should be treated with considerable caution when it comes to assessing the Qilalugaq project."
He explained that the valuation was further challenged by the presence of two distinct diamond populations, including type Ib yellow diamonds. The occurrence of two populations was not known to exist at Q1-4 when the 2014 sample program was conceived. "Additional evaluation of the project will require the recovery of a larger diamond parcel including sufficient carats from each of the two populations to allow for a more confident assessment," he said.
WWW split the sample into three parcels: yellow, dark-yellow and non-yellow. According to WWW, some of the dark yellow diamonds were intense in color but they also included some cleavage and rejection goods and some of the diamonds classified as dark-yellow appeared more orange than yellow, which the company contended could attract a premium over other yellow colors. The dark-yellow parcel had the highest average price at $46 per carat, whereas the yellow and non-yellow parcels were both valued at $35 per carat.
North Arrow has been working toward earning an 80 percent stake in the Qilalugaq diamond project from Stornoway Diamond Corporation by completing the bulk sample. Now that the requirement is fulfilled, North Arrow anticipates notifying Stornoway of its intent to vest an 80 percent interest in the project, subject to a one-time back-in right held by Stornoway. Upon receipt of the notice, Stornoway will have a 60-day period in which to elect to increase its interest in the Qilalugaq from 20 percent to 40 percent by paying North Arrow an amount equal to three times the costs incurred during the work program, according to the company's statement.
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