2007

There Could Be Many Buyers For Famed Diamond Mine

April 2007

De Beers is selling the famed and historic Cullinan diamond mine near Pretoria, and analysts say it could have many takers.

Cullinan, which was first opened in 1902 and produced the 3,106 carat Cullinan Diamond among its gems, produced 1.3 million carats in 2006.

Some diamond industry executives are confused that De Beers would sell such a valuable asset. The group is also selling its underground operations at Kimberley, but they have already been shut down.

De Beers spokesman says Cullinan no longer fits into the new De Beers business model, which is focused on profitability. Analysts think De Beers simply does not want to take the risk at Cullinan and wants to move its technical expertise to other projects.

But a junior mining company might operate it more cheaply than De Beers. It also might be an attractive purchase because it is occasionally produces large, but extremely valuable, diamonds.