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CEO wants more than US$60 million for biggest diamond in a century

Lucara's 1,111 carat gem-quality, type IIa diamond.

[LONDON] How much does the head of the company that unearthed the second-biggest ever diamond want for the gem? More than US$60 million, that's all he'll say.

"I haven't even told my wife," said William Lamb, chief executive officer of Lucara Diamond Corp, which last week announced the discovery of the 1,111 carat gem-quality diamond.

It's "higher than the current estimates that people are putting out there, which are north of US$60 million."

The discovery sent shockwaves through the US$80-billion diamond industry. The type-IIa stone, just smaller than a tennis ball, is the biggest unearthed since the 3,106-carat Cullinan gem found in South Africa in 1905. That was cut into pieces, which are set in the Crown Jewels of Britain.

Exceptionally large rough diamonds can sell for about US$60,000 per carat, though Mr Lamb hopes that its status will boost its value. The first Lucara worker to touch the stone was at the time the only person still alive who's handled a 1,000-carat diamond, he said.

"A lot of people will use use US$60,000 a carat as the basis," Mr Lamb said. "On top of that, you have to look at the size of the final polished diamond as well as the historical context. That's going to play into it too."

The CEO, who has already turned down an offer of more than US$40 million, said the company has been approached by London's Natural History Museum about displaying the stone and the Discovery Channel who are interested in making a documentary about it. The Vancouver-based company isn't in a rush to sell because it has no debt.

"The diamond sector is not full of opportunities, so for us to run out and sell it now doesn't really make sense," Mr Lamb said. "We have the time to look at what is the best way to sell it. Not selling it is actually an option."

Lucara's Karowe mine in Botswana rivals Gem Diamonds Ltd's Letseng operation in Lesotho as the place to find the biggest and best stones. Gem Diamonds previously held the record for the largest stone discovered this century with the 603-carat Lesotho Promise. Lucara in July sold a 341.9-carat diamond and a 269.7-carat gem for just more than US$60,000 a carat. Gem Diamonds offloaded a 357-carat stone for US$19.3 million in September.

As well as one "significant" single polished stone, there'll be other offcut pieces as large as 20 to 30 carats each worth millions of dollars, Mr Lamb said. The Lesotho Promise produced 26 flawless diamonds, including a 76.4-carat pear- shaped gem.

Luck also played a role. The company may never have caught the diamond if it didn't recently increase the size of the holes at its plant that lets gems drop through instead of being smashed along with rock dug from the ground. Lucara can now catch gems as big as 1,800 carats and needs to decide whether its worth investing in expanding the capacity to 3,000 carats.

Will there be more 1,000-carat-plus stones?

"There's no real statistical numbers you can run on this," said Mr Lamb. "It's an absolute anomaly. It's too far off the curve."