North of 60 Mining News - The mining newspaper for Alaska and Canada's North

Mountain Province Diamonds Inc. Nov. 2 announced it received C$45.7 million (US$34.3 million) from the Oct. 30 sale of 559,528 carats of diamonds from the Gahcho Kué Mine in Canada's Northwest Territories at an average price of US$61 per carat.

This marks the Mountain Province's second traditional commercial sale since before the onset of the COVID-19 pandemic.

"We are pleased with the result of our second post COVID-19 sale despite the ongoing challenges during the pandemic; the interest shown at the sale was excellent and drove the outstanding result," said Mountain Province Diamonds President and CEO Stuart Brown. "The continued recovery in diamond prices across the categories is positive for the company and indeed the industry. "We are encouraged that a positive momentum is building as we enter the all-important traditional retail selling season."

Mountain Province owns a 49% joint venture interest in the Gahcho Kué diamond mine in Canada's Northwest Territories – De Beers Canada Inc. owns the remaining 51%.

Gahcho Kué is Mountain Province's sole producing asset. As such, the company relies on the sale of its share of diamonds from the Northwest Territories mine to fund its portion of the operation and corporate expenses.

In mid-March, however, the diamond trading floors in Belgium and Israel were closed due to the coronavirus pandemic. This, along with the closure of retail outlets and cancelling of gem shows around the globe, essentially shut down the traditional markets for diamonds.

This led Mountain Province to reach an agreement to sell its run-of-mine diamonds, under 10.8 carats, to Dunebridge Worldwide Ltd. at the prevailing market price at the time of each sale.

In September, Mountain Province made its first sale through traditional channels, selling 210,661 carats of diamonds in Antwerp, Belgium at US$42 per carat for C$11.7 million (US$8.9 million) for the company.

Mountain Province Diamonds Inc.

A 60.6-carat vivid yellow fancy diamond from Gahcho Kué.

Between this sale and the diamonds sold to Dunebridge, Mountain Province received C$47.3 million (US$35.3 million) from the sale of 956,000 carats at an average realized value of C$50 per carat (US$37) during the third quarter.

"After a sustained period of negative news with respect to the diamond industry and dealing with the impact of the COVID-19 pandemic, we are pleased to see that the market for rough diamonds is starting to show some positive momentum. In the third quarter we have seen prices recovering close to pre-COVID levels from the lows seen during the peak of the pandemic."

Mountain Province noted that the sales data since the start of the pandemic does not include any fancies and special diamonds, which could boost the per-carat price of future sales.

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Shane Lasley, Publisher

Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

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