Disclosing this, Dough Bailey Ashton's executive director for finance and administration pointed out in an informal chat that the K-14 kimberlite which was bulk-tested, had yielded nearly 56 carats of diamonds with two big stores but the grade (yield per tonne of mineral) was considered below expectations. Further sampling there and elsewhere would continue as planned.He also disclosed that Ashton was helping the Diavik diamond project in Canada which was actually being developed by Rio Tinto jointly with some other local partners. This was expected to be commissioned in about two years. He hinted at the possibility of Argyle Diamonds marketing the roughs to be produced by that project which would be the second diamond mine in Canada.

The first diamond mine named Ekati has already been commissioned inCanada by the BHP/Diamet Minerals group. It has started marketing of its roughs through its Antwerp outfit.Some Indian firms are reported to have already received these high quality Canadian roughs. Bailey disclosed that Ashton had recently commissioned its Merlin project in the Northern Territory of Australia. It represented the second hard-rock diamond mine in that country. Initially it was expected to produce 2.50-3.00 lakh carats of good quality diamonds per year. The Cuango basin project in Angola in which Ashton has a stake of over 30 per cent has already started production since mid-August 1998. The marketing of those stones will, however, be done through the Central Selling Organisation (CSO) under some prior arrangement.Referring to the rebel trouble in that area, he said that the Angolan government was providing enough military protection to keep rebels away from that area. Nearly 1.5 million carat of high quality rough diamonds will be available annually from that mining project. Though themarketing of these stones will be handled by CSO, sorting will be done in Angola.

Ashton hopes to commission in the next few months its alluvial diamond project is Indonesia. Though in terms of volume the project will be relatively small, yielding about 40,000-50,000 carats of diamonds per annum, - the quality of these stones will be very good. He also stressed that Ashton was a long-term diamond player and had exploration projects in various parts of the world, including Botswana, Russia and South Africa. Also plans were underway to prolong the life of the diamond mine at Argyle. Meanwhile, Argyle has been able to step up its output to 40.8 million carat in 1998 from 40.17 million carats in the earlier year. While there has been some selective stocking Argyle has been able to improve pricing while maintaining volumes throughout the year. This in turn reflects strong demand for cheaper rough product, as the buoyant US market continued to absorb large quantities of cheaper polished goods and the Asiansmarkets traded down to lower price points.