North Arrow photo: Approx 1400 bags collected from the bulk sample in Repulse Bay

North Arrow photo: Approx 1400 bags collected from the bulk sample in Repulse Bay

Canadian diamond explorer North Arrow Minerals (NAR.V) reported disappointing diamond valuation results from the Qilalugac project bulk sample test this morning:

The parcel of 383.55 carats of diamonds greater than +1DTC (~1 mm) was valued at $13,795 or $36 per carat and a modelled range of possible values was also produced with a “possible low” model price of $43 per carat and a “possible high” model price of $92 per carat. The diamond valuation exercise was conducted by WWW International Diamond Consultants (“WWW”), an international diamond consultancy that specializes in the valuation and modeling of diamond parcels of this type.

All figures USD.

Previously, North Arrow Minerals CEO Ken Armstrong indicated he wanted to see a diamond value greater than $150 per carat. The value range of $36-$92 USD comes short.

Mr. Armstrong commented “The diamond parcel recovered from the Q1-4 bulk sample is very small and, as a result, the primary conclusion reached by WWW is that these valuation results and modelled values should be treated with considerable caution when it comes to assessing the Qilalugaq Project.” Mr. Armstrong continued, “The valuation of this small diamond parcel is further challenged by the presence of two distinct diamond populations, including a population of rare Type Ib yellows diamonds. The occurrence of two identifiable diamond populations within a single deposit is unusual and was not known to exist at Q1-4 when the 2014 sample program was conceived. Additional evaluation of the project will require the recovery of a larger diamond parcel including sufficient carats from each of the two populations to allow for a more confident assessment. North Arrow will review options for the cost effective collection of a larger sample, taking advantage of Q1-4’s large size and advantageous location near tidewater and the Hamlet of Repulse Bay (Naujaat).”

Shares of North Arrow (NAR.V) fell over 52% to 45 cents in the first 20 minutes of trading Tuesday.

On May 28, North Arrow closed a C$ 4 million bought deal financing at 95 cents per share.

The company is focused on the Qilalugac project in Nunavut, the Pikoo project in Saskatchewan and has a portfolio of other early stage diamond projects in Canada.

Here’s today’s news release: North Arrow Reports Diamond Valuation Results From the Qilalugaq Project

Author is a shareholder in North Arrow and they are a 2015 Toronto Subscriber Summit sponsor. This makes me biased and on the wrong side of the trade Tuesday.

For the latest commentary on North Arrow from the CEO.CA community, visit the NAR room at CEO.CA Chat.

[Always do your own due diligence and consult a licensed investment advisor prior to making any financial decisions. This is not investment advice. See North Arrow’s profile on to fully understand the company and its risks.]