2004

BHP, RTZ Happy with Diamond Results

May 2004

Both mining giants BHP and RTZ are happy with the results from their Canadian diamond mines, press reports say.

Last quarter, BHP made 56 cents of profit from every $1 of sales from its mine Ekati. The company recently rejected two offers from Israeli company DGI to buy the mine, which has been valued at $1.1 billion.

Instead, BHP may expand Ekati. It is considering spending $145 million to develop an underground mine that would produce 3,200 metric tons of ore a day after it starts producing in 2005.

The company is also looking for more diamond finds. BHP Billiton spends the largest part of its mineral exploration budget on diamonds, including $22 million spent looking for gems in Canada.

Rio Tinto, which owns both Diavik and Argyle in Australia, saw its net earnings from diamonds in 2003 surge 79% to $113 million, from 63% in 2002. It, too, says it is likely to add underground mines to Diavik when the copen pits are complete.