Monthly Archives: December 2010

Wikileaks, Zimbabwe & Blood Diamonds, Part II

by Richard W. Wise, G.G.

Wikileaks, if it has done nothing else, has directed a searingly bright light on the hypocritical world of international relations in general and the Kimberly Process in particular. For those who don’t know about it, The Kimberly Process comes down to a series of criteria, developed by the diamond industry, whereby a chain of ownership is established to enable sellers to certify that the diamond you are buying for your wife, to celebrate the birthday of the Prince of Peace, was not obtained from a starving West African miner at machete point. The process was initiated because of a storm of press reports generated by Global Witness, another bunch of whistle-blowing trouble makers who objected to people having their arms and legs hacked in the pursuit of diamonds to fund bloody civil conflicts in West Africa.

In August 2010 the Zimbabwe government auctioned 71 million in Marange diamonds certified by The Kimberly Process. The Process as it relates to current events in Zimbabwe has become something of a joke. In June 2009, Ian Smillie, a conflict diamond expert, architect and Director of The Kimberly Process resigned, stating: “when regulators fail to regulate, the systems they were designed to protect collapse.” In an interview with Bob Bates of Jewelers Circular Keystone, Smillie has this to say about Zimbabwe:

“With Zimbabwe, the government of South Africa is really protective of the Mugabe regime. But it isn’t just them. The Russians say this is not a human rights organization. But what is it exactly supposed to be? It’s there to protect people against conflict diamonds. Some governments are placing their small regional political interests over the interest of the diamond industries. Others in the region just hope that people won’t care. Interview with Ian Smillie former Director of The Kimberly Process: Source: Jewelers Circular Keystone, 2009

Jennifer Connelly and Leonardo Di Caprio in a scene from the movie Blood Diamonds. I have been to a lot of gem mines but I have never run into Jennifer.

Jennifer Connelly and Leonardo Di Caprio in a scene from the movie Blood Diamonds. I have been to a lot of gem mines but I have yet to run into Jennifer.

According to cables originating from the American Embassy in Zimbabwe, undocumented diamonds mined in Marange area are sold directly to foreign buyers:

“Although Zimbabwe is a participant in the
Kimberley process, the diamonds from Chiadzwa are
undocumented and therefore are not in compliance with
Kimberley, which requires loose uncut diamonds to be
certified.” Source: Wikileaks

This assertion is backed up by an article written by in 2008 by Chenjerai Hove a celebrated Zimbabwean writer who was driven out of Zimbabwe in 2001 for criticizing President Robert Mugabe. “Marange and Chiadzwa are now international destinations. Israelis, Lebanese, Belgians, Afrikaners, Japanese, Americans, Germans, national political heavyweights and businessmen, all sorts of diamond gladiators who sniff the air for wealth, have been seen visiting the once-neglected Chiadzwa, Marange.” Read the full article.

The leaked cables go on to state:

“The highest quality diamonds are not sent to Dubai,but are shipped to Belgium, Israel, or South Africa for
cutting” Source: Wikileaks

It is important to that these quotations are taken from cables classified by Ambassador McGee, a representative of the United States government to assure that the information they contained would not be made public. Who was at risk here, which sources and who’s assets? According to the leaked cables these assets include:

“Cranswick said that RBZ Governor Gideon Gono,
Grace Mugabe, wife of President Robert Mugabe, VicePresident
Joyce Mujuru, Mines and Mining Development Minister Amos
Midzi, General Constantine Chiwenga and wife Jocelyn, CIO
Director Happyton Bonyongwe, Manicaland Governor Chris Mushowe, and several white Zimbabweans, including Greg Scott, and Hendrik O,Neill, are all involved in the Marange diamond trade.”

Source: Wikileaks

Why were these cables classified? Was it Ambassador McGee’s objective to protect the people named above or was it simply to avoid embarrassing a senior attache’s wife who might choose to wear her shiny new three carat diamond ring to an embassy cocktail party?

Grace Mugabe, wife of the President of Zimbabwe has filed a 10M dollar libel suit. What's that on your finger, Grace?

Yesterday it was reported that the wife of the president of Zimbabwe, Grace Mugabe had filed a defamation suit against the South African newspaper The Standard for reproducing reports from Wikileaks.

Are Zimbabwe Blood Diamonds Identifiable?:

Unlike colored gemstone that are, for the most part, formed in the earth’s crust and contain inclusions specific to the geographic areas where they were formed, diamonds are formed in the mantle. For the most part, it is not possible to separate diamonds by origin. However, I have read several reports that seem to indicate that these diamonds are easily identifiable, at least in the rough. The following is quoted from www.diamonds.net:

“The source suspects that Marange diamonds were being filtered out to most of the major diamond centers, including Israel, South Africa and Belgium for larger stones, and India and Dubai for the smaller goods. He described Marange diamonds as being unique in appearance and therefore very recognizable “even to the layman.” They vary in value from $5-per-carat industrial stones to $1,000-per-carat gem-quality diamonds, he explained.”

This source gives not details as to how Marange diamonds might be identified by a layman, but according to one of our readers, Deepak, a diamond dealer from India, Marange diamonds do show a distinctive green tint (see Part I, Deepak 12/19 comments). Diamonds are color graded by placing them table down in a white tray under special lighting. Under these conditions, according the Deepak, Marange stones will betray a slight greenish cast, we are not talking green diamonds here, just a very slight tint, but distinctive enough to be seen by an experienced grader.

The possibility that immediately comes to mind is that the green tint is the result of natural radiation. Fancy green diamonds derive their coloring from natural radiation. Is this the source of the green tint in the stones from Zimbabwe? If so, these stones should be easily detectable. It would seem that a U. S. Customs agent, armed with a Geiger counter, or a more advanced instrument, might significantly reduce the flow of blood diamonds into the U. S., the world’s largest diamond market.

Wikileaks, Saint or Savior?

The U. S. Government is doing its best to demonize Wikileaks. President Obama has taken a posture that has him, seemingly, talking out of both sides of his mouth all at once. “While I’m concerned about the disclosure of sensitive information from the battlefield that could potentially jeopardize individuals or operations, the fact is, these documents don’t reveal any issues that haven’t already informed our public debate on Afghanistan…” Mr. Obama said.” Well, which is it? Wikileaks revelations are damaging our national security or they are irrelevant? Clearly people are dying in Zimbabwe, about five per week according to documents leaked.

Government sources are fond of using the term collateral damage. It means innocent people died, but usually not our innocent people. When, for example, a drone strike is called in on a suspected Al Qaeda or Taliban gathering in Afghanistan, the civilians who are killed as part of our efforts to suppress these two movements is called unfortunate and ultimately dismissed as collateral damage. In the case of Zimbabwe and its brutal exploitation of both its resources and its people, the outing of those responsible is necessary. If it is not done, many more will suffer and by some accounts they have, at the rate of several per week. The question we must ask is why the secrecy? Why were official U. S. Government cables detailing these atrocities suppressed by classifying them? What vital American interests are we protecting? De Beers, the diamond industry, big business?

I believe that it is opacity that is the true cause of collateral damage in this case and most others. President Obama came into office with a promise of transparency. It appears that this is another promise that will not be kept. When Wikileaks reveals the names of American agents in the field, they are at risk. When our government suppresses information about blood diamonds in Zimbabwe, people die. When we accept a public relations ploy such as The Kimberly Process in place of a real certification, a few people get rich and more people die. I think the real issue here is not Wikileaks, it is transparency. If we had transparency, Wikileaks would not only be irrelevant, it would not exist and there would be no issue and a lot fewer deaths.

Wikileaks, Zimbabwe & Blood Diamonds, Part I

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by Richard W. Wise. G.G.

Diamond fields outside of Chidzwa Village, Marenge, Zimbabwe, 2008

Wiki-leaks has been very much in the news and despite dire predictions from the Obama administration that material being leaked would put the lives of American officials and their assets abroad in danger, much of what has so far been discussed reads more like a series of tabloid news reports.

Among the 251,287 cables just released of which about half are labeled Secret or Confidential and half are unclassified, we learn to everyone’s surprise, that American officials are not particularly impressed with Afghan president, Mohamed Kharzi. The cables also contain disparaging remarks about Russian Prime Minister Vladimir Putin running a “virtual Mafia state” and about Italian President Berlusconi‘s relationship with an 18 year old Moroccan dancer.

Of particular interest to those of us in the Gemstone/jewelry community are Wiki-leaks of a series of cables written from the Office of the former Ambassador to Zimbabwe, James McGee in 2007-08 that relate to the situation in the Marenge diamond fields near Chidzwa Village in Zimbabwe.

Andrew Cranswick, CEO of African Consolidated Resources (ACR) is named as the source of much of the information. ACR a publicly traded British firm was the leaseholder until 2006 when ACR was ousted and the lease was taken over by the Zimbabwe government’s own Mineral Marketing Corporation (MMCZ). So it is safe to say that Cranswick has an axe to grind. “It was highly irresponsible for Wikileaks to publish names,” he told The Daily Telegraph. “This is extremely dangerous and puts peoples’ lives at risk.” Cranswick is reported to be going through bankruptcy proceedings in Australia.

Marenge Diamond Fields Said To Be Exceptionally Rich:

Cranswick describes the fields as exceptionally rich:

“Cranswick told us he was confidentially shown a report prepared for the De Beers Corporation by noted geologist John Ward. The report estimated that Chidzwa had a CPHT (carats per hundred tons) of over 1,000. By comparison, the Rio Tinto/Rio Zimbabwe-owned Murowa diamond mine near Zvishavane in Midlands province has a CPHT of 120.”

To put these number in perspective, Australia’s famous Argyle Mine was rated at 30.5 CHPT in 2005. De Beer’s South African claims average 85 CPHT. The highest CPHT previously noted was found in a small pipe adjacent to Slave Lake in Siberia that yielded 139 CPHT but the pipe was played out within two years.

Jawaneng Mine, Botswana

The three pipes at the Jwaneng Mine in Botswana, described by De Beers as “the richest mine in the world” have a CPHT of 141.

To properly evaluate Marenge’s potential it is also important to know the average value of the production per ton. For example although the Onea mine is rated at only 0.5 CHPT, the average per carat value is $880 versus $11.50 per carat from Argyle. According to Cranswick in the Wikileak-ed cables, a Russian group purchased $500,000 dollars worth of diamonds at $29.00 per carat. Cranswick describes the production as 60% industrial and 40% gem or facet-able material, other reports put the ratio closer to 70/30

More to come. Bypassing The Kimberly Process: Next on GemWise

Golconda orType IIa Diamonds; Big Prices at Auction

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By Richard W. Wise, G.G.

(portions originally published in 2008)

Another Auction Record? Well Not Quite:

On Tuesday, Christies sold a 27.03 carat DVVS1 cushion cut type IIa diamond for 3.55 million or $131,502 per carat. In a fit of salesman-like overstatement, Rahul Kadakia, referring to a 30 carat D-Flawless type IIa that sold last year for $130,000 per carat, stated that “This represents a 45% increase in the value of top diamonds in just twelve month’s time.” While it is true that a flawless diamond will command a significant premium over a mere VVS, Kadakia is ignoring recent history. At a Sotheby’s Magnificent Jewels auction held in New York on April 17th, a 24.42 carat D color Internally Flawless diamond sold for 3.6 million or better than $148,443 per carat. One day earlier at Christies another rectangular step cut diamond weighing 27.91 carats (pictured above left) sold for 4.04 Million or $145,933 per carat.

Collectors Paying Big Premiums for type IIa diamonds:

Sales talk and hyperbole aside, Type IIa diamonds are regularly knocking down auction records. Gems of this type are often called “Golconda” diamonds after the famous Indian mines that supplied a majority of the world’s diamonds until they were mined out in the early 18^th Century. Collectors, particularly Europeans are willing to pay high premiums for these rare gems and for good reason.

Most of the world’s big name diamonds, those mined before 1725, the Koh-I-Noor, The Sancy and for that matter, The Hope diamond came from the fabled diamond mines of India, all are type II diamonds.

Type IIa is a rare type of diamond that contains no measurable amounts of Nitrogen. Nitrogen is the impurity that imparts the yellow color in diamonds. As a result “white” diamonds of this type tend to be colorless (D-F) colors and have few inclusions. (see GemWise:http://www.thefrenchblue.com/rww_blog/?p=29

Type IIa diamonds have unique characteristics. Stones of this type are famous for their exceptional lack of color, a color that goes beyond D and is sometimes referred to as super-D.

“…the old Golconda stones were by comparison ‘whiter than white.’ Place a Golconda diamond from an old piece of jewelry alongside a modern recently cut D-color diamond, and the purity of the Golconda stone with become evident.”

Benjamin Zucker; Gems & Jewels; A Connoisseur’s Guide

Type IIa diamonds have also been found in Brazil and at South Africa’s Premier Mine. It is estimated that only about 1% of the world’s diamonds are type IIa. The auction houses tend to lump together all type IIa stones, but be warned; not all type IIa diamonds are created equal. It is not enough that a stone fits the scientific definition. A true Golconda or perhaps I should say Golconda-type gem is not only “whiter than white”, diamonds of this type have other characteristics that contribute to their unique beauty, characteristics that sets them apart from the common herd.

Gems of The Finest Water:

Prior to the invention of modern terminology, exceptionally fine diamonds were referred to as “gems of the finest water”. The “term” water goes back to at least the Seventeenth Century. Water combines two concepts; color and transparency. For the purposes of rhyming I have renamed this later quality crystal and include it along with color, clarity and cut as one of the “Four Cs of Connoisseurship”. For a gem to be truly considered fine it must have both exceptional color and crystal so “super-d” too refers to more than just the total absence of color:

“This designation (super-d), one that sounds about as romantic as a name-brand motor oil refers to antique diamonds from India’s legendary Golconda mines—stones that are reputed to exhibit an extraordinary transparency.”

Richard W. Wise; Secrets of The Gem Trade, The Connoisseur’s Guide To Precious Gemstones

The True Blue White Diamonds

Type IIa diamonds have yet another characteristic, one that is not well understood or even well known among gem professionals; under certain conditions the stones will emit a blue glow in daylight.

The mechanism that produces this phenomenon is not well understood but it is not ultra violet fluorescence. About one third of all diamonds fluoresce blue under ultra-violet light. A few of these, diamonds with very high fluorescence, will actually appear milky or foggy, i.e. lose transparency in daylight. Golconda-type IIa diamonds, rarely possess fluorescence in any meaningful degree:

In a paper presented in 1975 at the 15^th International Gemmological Conference, gemologist and author Herbert Tillander made the following observations:

“This type (type II) includes all natural blue diamonds, the only current source of which is the Premier Mine and some really blue-white stones without fluorescence.”

“Type II diamonds in general do not fluoresce although they give a bluish afterglow.”

Herbert Tillander, The Hope Diamond and its Lineage, p. 7

The problem is that the blue glow is quixotic and unreliable; Like the famous green flash at sunset that is sought, usually after a couple of Margaritas, by Caribbean vacationers, this phenomenon refuses to dance to the gemologist’s tune.

“Here, in the afterglow of day, we keep our rendezvous beneath the blue And, in the same and sweet old way I fall in love again as I did then.”Twilight Time,

The Three Suns

French 17th Century gem dealer, Jean Baptiste Tavernier

My love affair with this curious phenomenon began at about 2:30 one sunny late June afternoon in the Berkshires. A client and I were comparing two 10 carat type IIa diamonds. Both had GIA certificates, both graded D-Flawless with no fluorescence; one, a modern radiant and the second an Old European, said to be an old Golconda stone that looked like the Regent’s younger sibling. We placed the two together in the afternoon sun, suddenly a phenomenon like a blue haze appeared to dance above the old cushion, while the modern cut stone just sat quietly.

“…the never failing test for correctly ascertaining the water is afforded by taking the stone under a leafy tree and in the green shadow one can easily detect if it is blue.”

Jean-Baptiste Tavernier, 1689

The old Golconda diamonds exhibited these three characteristics, ultra-colorlessness, a high degree of transparency and, if Tavernier is to be believed, a delicate blue glow. Tavernier as quoted above bought all his diamonds in India. Given his statement it would seem to follow that in the original meaning of the term, a blue white diamond was not, as most experts believe, a blue fluorescent stone but rather a non-fluorescent Golconda diamond.

“The Regent possesses that unique limpidity characteristic of so many of the finest Indian diamonds together with a beautiful light blue tinge.”

Ian Balfour, Famous Diamonds

Balfour gives the following description of the 135.92 carat Queen of Holland diamond (pictured left)

“Yet there are experts who, after examining it think that the ‘Queen of Holland’ is a typical Golconda stone. It has been classified as an ‘intense blue’: although it is a white diamond it does possesses a definite blue tint, rather like the colour of cigarette smoke. The Gemological Institute of America has graded the ‘Queen of Holland’ as ‘internally flawless’ and ‘D’ colour…”

Ian Balfour, Famous Diamonds

Very little of any information about Golconda diamonds exists in the current or historical literature. This explains why so few experts are aware of Golconda-type IIa diamonds and their characteristic beauty marks. Specialists that I consulted, at both Christies and Sotheby’s, were totally unaware of the phenomenon of the blue glow. Perhaps this is because, in at least some cases, this ethereal phenomenon is, as I have said, quixotic. It only appears under certain as yet indefinable conditions. It can be seen in sunlight and most gem experts, particularly those in New York, don’t get out much and when they do in the polluted haze that hangs over The City, perhaps the phenomenon is not visible at all.

Mystery Solved?

I had a conversation with Tom Moses who is GIA’s point man on grading fancy color diamonds. Finally a living person other than myself who has seen this affect. Moses is indeed familiar with the blue phenomenon which he describes as the Tyndell Effect similar to the affect that makes the sky blue. This same cause was suggested by Fancy Color diamond specialist Stephen Hofer in a conversation I had with him two years ago.

According to Moses, Type IIa diamonds usually do not fluoresce or if they do, the fluorescence is so weak that it is not reported on GIA’s grading reports. The blue glow is not at all characteristic of a specific location; Moses has seen it is Type IIa diamonds from South Africa, Brazil and Russia. Only a small percentage of type IIa diamonds exhibit this blue glow.