Greenland Ruby
Photo compliments of True North Gems Inc.
When True North Gems Inc. officials talk about the "Big Three," they are not talking about Roosevelt, Churchill, and Stalin. They are talking about their own "Big Three" - rubies, sapphires, and emeralds. Thanks to the company's most recent acquisition, True North now has them all: emeralds from the Yukon, sapphires from Baffin Island, and now rubies from Greenland.
The company rounded out its trio this spring when it acquired an option to earn a 100% interest in Greenland's Fiskenaesset ruby property. Under the terms of the option agreement, True North will pay to the vendor $150,000 cash and issue $150,000 worth of shares over four years. A production bonus of $500,000 cash and $500,000 worth of shares is also payable in the event the company converts the current exploration licence into a production licence.
"When True North began its evolution as a company, it had one of [the Big Three]," said True North's Chief Operating Officer William Rohtert. "We decided it wasn't just about emeralds in the Yukon. It was about entering a new business. That business is . . . the international coloured stone trade."
"If you are going to be involved, you're going to have to have the Big Three," he said.
The company is confident its latest acquisition will provide a secure, long-life mine source for a lucrative gemstone polishing operation. Field investigations in 2004 will quantify the extent of the surficial and bedrock deposits, select bulk sample sites, and identify drill targets. The company will also study recovery techniques to determine how best to liberate the red gems ruby from its host rock, authenticate its unique geological properties, and initiate a preliminary market test for new gemstone and jewelry products.
The program is clearly successful. Not only has True North "survived the start-up," said Rohtert. "It's been developing the exploration play to an advanced stage, the indicators are good and we are going ahead with our 2004 . . . prefeasibility season."
The company closely follows the Canadian diamond industry's precedent - a proven recipe for success. "The same way that the diamond business is a template for us," said Rohtert, "the diamond exploration technologies and strategies are also a template for us."
For its coloured gemstones, True North anticipates the same reception as Canadian diamonds enjoyed. "Our objectives are to deliver Canada as a producer of coloured stones in much the same way that she had now been delivered as a producer of diamonds," said Rohtert. "The world over, there is $5 billion worth of trade, largely originating from developing companies. . . . Most of the consumption is in United States, Canada, Northern Europe and Japan," he said. "This is a rare case, where a consuming country . . . has a chance of also being a producing country - producing diamonds and the emeralds and the gold that go together into the ultimate product - which is jewelry."
But don't expect a discount just because these gems are produced close to home. "We have to be competitive on pricing," said Rohtert. "What we are counting on is that there will be a preference for Canadian colours the same way there is a preference for Canadian diamonds." The same, he hopes, will be true of the Greenland rubies.
So keep an eye on the 5,500-hectare Fiskenaesset ruby property, lying in Greenland's Qeqertarsuatsiaat district, 160 kilometres south of the capital, Nuuk. Since the district's first ruby discovery in 1953, 50 tonnes of high-grade ruby ore have been produced. In 1981, 340 grams of rough ruby and about 21 grams of good-quality polishable material were drawn from a 1.36 tonne mini-bulk sample. Ruby is relatively abundant and widespread in this setting, with individual crystals growing as large as a centimetre.
Ruby is the red variety of the mineral corundum; the blue variety is sapphire. Corundum is extremely hard - it hardness topped only by diamonds. Ruby's red colour results from traces of chromium within the crystal lattice. Of the "Big Three," ruby is rarest by far and usually occurs as six-sided, barrel-shaped crystals. Commercial ruby deposits are mined in only a handful of places, including Myanmar, Thailand, Vietnam, Cambodia, Sri Lanka, and Tanzania, with other important occurrences in Afghanistan, Pakistan, India and Kenya. Collectively, the "Big Three" account for an estimated 70 percent of the value of the annual global trade in coloured gemstones.
"True North is optimistic," said Rohtert. "It feels like the right time in the right place for a developing business. . . . Much the same way that the attention in the world of diamonds shifted northward gradually to unexplored territory for new opportunities, so too, is the attention of the coloured stone business following."
For more information about True North Gems Inc. and its colourful alliance, visit www.truenorthgems.com. The company trades as TSX-VEN:TGX.