Introduction
The Argyle Diamond Mine is one of the world’s largest suppliers of diamonds, producing approximately 20 million carats each year from its operations in the East Kimberley region, in the remote north of Western Australia.
The Argyle Diamond Mines Joint Venture (ADMJV) was established in 1982 to own and finance the Argyle mine. The development and operation of the mine is governed by a State Agreement although Argyle Diamonds is 100 per cent owned and managed by Rio Tinto Limited. Their website is www.argylediamonds.com.au.
Argyle began mining its main ore body in 1985, and has since produced more than 760 million carats of diamonds.
According to their website information, Argyle currently operates an open pit mine and a processing plant 24 hours a day, 365 days a year. The AK1 open pit is 2 kilometres long, 1 kilometre wide and covers an area of almost 300 hectares. The principal activity in the pit is the removal of overburden and collection of diamondiferous ore. Ore in the pit is broken by the use of explosives with each blast hole liberating about 3000 tonnes of rock.The Argyle Diamond Mine has been operating since 1983 producing over 670 million carats of rough diamonds and generated more than US$6 billion in revenue during that time.
The diamonds produced by the Argyle mine are found in a range of colours including white, champagne and pink. Argyle is the world’s primary source of rare pink diamonds, which have become Argyle’s signature stone.
The diamonds recovered at the mine are sent to Rio Tinto Diamonds’ sales and marketing office in Antwerp Belgium, where they are sorted and prepared for sale. The majority of the diamonds from the Argyle mine are sold as rough diamonds, to a customer base primarily consisting of Indian diamond traders and manufacturers.
The rare pink diamonds from the Argyle mine are all cut and polished and sold as loose polished diamonds to an international customer base. The Argyle Pink Diamonds business is based in Perth, Western Australia, and is also the location of its state-of-the art cutting factory. The Perth factory cuts and polishes the finest pink diamonds from the Argyle Mine which are then sold via exclusive tenders.
Rough DiamondsMost of the diamonds extracted from the Argyle mine are sold as ‘rough’ or uncut stones. Between 1983 and 1996, they were sold via two sales agreements with De Beers. The first agreement (1983-1991) helped provide industry and investor confidence in the viability of the mine. It also gave the company time to gain expertise in the sorting and valuation of its diamonds, as well as in marketing them. Diamond industry analysis conducted during this period provided the foundation for marketing systems that were eventually developed. These were used to underpin the establishment of a competitive advantage for Argyle in the market place.
Critical to the company’s marketing strategy, from as early as 1983, were sales direct to the market. This provided verification for the rough diamond prices received within the contractual agreements. A direct sales office in Antwerp, Belgium was opened in 1985, and a representative office in Mumbai, India in 1989. In 1996, Argyle began to market its entire production of rough diamonds through its Antwerp office in Belgium.Initially Argyle’s diamonds were a challenge to polish because of their stressed crystal structure, irregular shapes and etched surfaces. To overcome the problems experienced by polishers accustomed to diamonds which were easier to interpret, Argyle initiated programs in India to assist polishing factories with processing these stones.
The majority of customers for the Argyle production are Indian based companies and the Indian cutting industry has played an important part in the development of the market for the small, coloured diamonds that characterize Argyle production.
In June 2002 the sales office in Antwerp, Belgium was expanded to provide a centralised sorting, sales and marketing service to all diamond mines in the Rio Tinto Group. In addition to the Argyle Diamond mine, Rio Tinto owns a 60 per cent share in the Diavik Diamond mine in Canada and a 78 per cent share in the Murowa Diamond mine in Zimbabwe.
Argyle Pink DiamondsThe Argyle Diamond mine is the world’s primary source of rare pink diamonds attracting on average, 20 times the price of an equivalent white diamond. Rio Tinto operates a stand-alone pink diamond business to sell and market loose polished pink diamonds from the Argyle mine.
A list of Argyle Pink Diamond distributors can be found on the Argyle Pink Diamonds Website.
Beginning in 1984, the more exceptional polished pink diamonds from each year’s production have been sold individually at special auctions known as ’tenders’. Viewings have traditionally been held in New York, Tokyo, Perth, Antwerp, Hong Kong, London and Geneva. Participation in these events is by invitation to the worlds leading diamantaires and diamond jewellers.
The tendered pink diamonds have an average size of about 1 carat. Around 40 to 50 carats in total are sold at these auctions each year. Prices achieved range from US $100,000/ct to over US$1,000,000/ct.
To put the true rarity of these special ‘pink’ diamonds into perspective, of every million carats of rough diamonds produced at the mine, a mere one carat is suitable for sale in one of these tenders. Since 1985, more than 750 stones have been offered for sale at tender with a total weight of almost 600 carats.
Argyle Diamonds are considered among the most beautiful in the world.
