Wednesday, February 25, 2015

Chidliak - CH6 - Diamond Valuation Update - up/down 6%

From the original press release -- CH6 Maiden Valuation

We get the following:

"The average price was US$213 per carat and the entire parcel was valued at US$215,605. The modelled price ranged from a minimum of US$162 per carat to a high of US$236 per carat with a base case modelled price of US$188 per carat."

We now have an updated Technical report for Chidliak and new information has been provided as follows:

 "In January 2015, Mr. Neil Buxton issued the following statement:

“WWW International Diamond Consultants (WWW) valued the Chidliak diamonds in February 2014, and prices increased steadily through to August 2014 before liquidity concerns in the diamond markets became a reality. This was exacerbated by the Antwerp Diamond Bank (ADB) announcing that it was withdrawing from the diamond business. It is estimated that ADB was financing $1.6bn to the diamond trade or eleven percent of the total $14.5 billion of debt. At the same time wholesale polished diamond prices softened in the last quarter of 2014.  As with other commodities, there is currently a degree of uncertainty in the market and the WWW overall rough price index currently stands 6 percent lower than in February 2014.” "

From the Bank of Canada currency rates -- Bank of Canada Converter

We find the CAD$ was worth .9029 during the initial valuation.
Now it stands at .8052 today.

So, with a bit of calculation.

The Valuation of CH-6 has gone down 6% in US $ terms from US$212/carat to US$200/carat.
In CAD$ terms it has gone from CAD$235/carat to CAD$250/carat

The depreciation in the Canadian dollar outweighs the decrease in international diamond prices.

Result - Valuation of Chidliak is down 6% in US Dollar terms and up 6% in CAD terms

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