Diamond miner reassessing Ellendale mine options

Gem Diamonds is reconsidering its options on the sale of its Ellendale diamond mine in the Kimberley.

It comes just a day after BHP announced that it has sold its massive EKATI diamond mine the Arctic Circle for around $500 million.

In an announcement earlier this week said that despite the improved production at the site, it may have to decrease its sale price for the Ellendale mine as it has spent nearly a year on the market.

"The Company is currently reviewing the resources and mine plan at Ellendale, and in light of the short remaining life of mine and the current economic environment, even with the improvement in prices for the Tiffany quality goods," it said in a statement.

"This may potentially lead to a review of the carrying value of the asset at the end of the year."

The miner has previously stated that it is "considering all options with regards to the mine" in 2012.

However despite this concern, the operation has seen production lift by 28% over the previous period.

The Ellendale mine is one of the world's major sources of yellow diamonds.

Gem operates the mine through its subsidiary Kimberley Diamond Company.

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