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Feb. 2000

NovaDiamond, a wholly owned subsidiary of Novatek, recently announced a new treatment that turns certain brown diamonds into green and yellow fancy colored stones.

The treatment uses high pressure and temperature, similar to the Lazare Kaplan-GE “Pegasus” process, which makes brown stones “whiter.” However, NovaDiamond is only using the process to make fancy colored stones. The company president says he discovered the process by accident when making industrial stones.

Unlike Pegasus, the GIA says it can detect this process, especially since there is no radiation involved. Perhaps its experiments with this process will help GIA unwrap the mystery of Pegasus.

The market for yellow stones has always been a little mixed, although an impressive yellow can fetch a decent price. But green stones are truly difficult. If one shows radiation, the GIA will often mark that its origin of color is “undetermined,” as they say it’s impossible to tell if the radiation came from the ground or from the laboratory. And so the greens that GIA says are “natural” command a huge premium — even more than ultra-rare blues.

These new NovaDiamond green and yellow stones, however, are treated, but not irradiated. The market will determine if these stones sell for more than stones that are presumed to be radiated. We assume that the average consumer would rather own a treated green stone than a “radiated” one. However, since neither one is natural, we still think most consumers will prefer the real thing.

The company plans to sell the stones to retailers and consumers through the Internet. Its introductory price for the stones is 25 to 50% more than a comparably sized high-quality G-H, SI1 – SI2 white diamond. However, we doubt the company’s rather optimistic price projections. They say they have enough capacity to produce a million carats a year, but will produce according to demand.

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