Petra Recovers High-Quality Blue Diamonds

RAPAPORT… Petra Diamonds has unearthed five high-quality, blue, type IIb diamonds from its Cullinan mine in South Africa in the span of one week, it said Wednesday.

The stones, which weigh 25.75, 21.25, 17.57, 11.42 and 9.61 carats, have been assessed by the company and determined to be individual diamonds, rather than part of a larger whole. The last significant blue diamond Petra recovered was a 20.08-carat, type IIb, which it found in September 2019. The miner sold that stone at tender in South Africa for $14.9 million, or $741,000 per carat.

Petra is evaluating the best way to sell the diamonds, given the challenges presented by the Covid-19 pandemic, it noted.

The company is still in talks with its lenders regarding restructuring and repayment of its heavy debt. It missed a bond repayment in May, and saw its net debt rise to $658 million as of June 30. 

“While the company continues to have constructive engagement with the [lenders], there can be no certainty that these discussions will result in agreement being reached,” the miner said. “In addition, these finds, whilst a positive development, will not have material impact on the likely terms of the required long-term solution to improve [Petra’s] capital structure, nor the significant level of equity dilution that existing shareholders are likely to experience in connection with its implementation.”

Image: The five blue diamonds. (Petra Diamonds)