VOL. 14, #2, Summer, 1996

Burma Report by Cap Beesley, Interview with Alan Roup, Mandarin Orange Mine Owner, Money Magazine On-Line, Auction Reports, International Updates: Diamonds, Colored Gemstones: Sapphire, Bangkok Report, Colombia, Kenyan Tsavorite, Tanzanite, South East Asia Border Report, Collectors: Red Beryl, Privacy Section

  Jun 24, 1996   admin



by Cap Beesley

Cap Beesley recently returned from a two-week trip to Burma. He is among the first westerners to visit the famous Mogok mines in recent years. Here is his exclusive report. Cap Beesley is the President of American Gemological Laboratories (AGL) in New York. He can be reached at 1-212-704-0727 or email gemcore@idt.net

Burma (Myanmar) has been essentially closed to foreigners for thirty years. For most of the time, tourists were restricted to a 24 hour visa, which limited travel to Rangoon. Now there is open access to Mandalay and other important northern archeological centers. The current liberalization of travel restrictions and mining policies is revitalizing Burma's significance in the gem market and the travel industry. The persistent theme in and around the populated areas of Rangoon (Yangon) and Mandalay is "Visit Myanmar in 1996". Although this transition to a more open environment is underway, there are still elements of control and restraint that are evident throughout the system. For example, my trek, arranged through Burmese intermediaries, actually took almost 1 1/2 years of back and forth communication to organize. Beyond Mandalay, travel is only possible with government supervision and authorized travel agents.

AGL is particularly interested in origin and gemstone enhancement issues relative to ruby and sapphire in and around the Mogok area, which is the classic location for fine Burma material. A new location called Mong Hsu has in recent years produced substantial qualities of treated material. The end result of our extended negotiations with the government was open access to several above and below ground mining operations in and around Mogok. Although we were constantly supervised by a tour guide we nick-named "the shadow", there were no constraints on information availability or access to details concerning mining output or operation.

Mogok has an official population of 200,000, unofficially the count is estimated at 350,000. The elevation, climatic conditions, and an abundant supply of water in this area all create an ideal mining environment in which hydraulic recovery plays a pivotal role working alluvial deposits above ground. Most of the major projects are joint ventures with the military which carry big ticket lease costs paid to the government. Underground deposits are more widespread than I imagined, especially for ruby. Despite the volume of potential product and the production capability of some highly mechanized recovery plants, gems of high quality are still a rarity and command top dollar even in local dealer activity. Several open air markets are extremely active despite their "unofficial" status. Asking prices are frequently exorbitant, with some transactions taking days to complete because of the laboriously complicated broker dominated network of distribution. We tested all the acquisition mechanisms while acquiring a variety of materials for our laboratory research collection and training programs.

Foreigners are still an oddity in Mogok. During this visit I encountered two well supervised news crews representing French television. In general, reporters are viewed with distrust by the military government. During an interview with one of the French TV news teams, they probed concerning AGL's purpose for visiting this remote area and my interpretation of the future gem potential of this region and Burma in general.

One of the major producers of ruby, the Mong Hsu area was classified as a "brown" area, and off limits via road, but accessible by helicopter at $10,000(US) round trip. Insurgents and bandits can easily block the very poorly maintained and narrow 1 1/2 lane, major highways. The military in Burma estimate that there are 200,000 people working in this relatively new mining area. Unfortunately, the majority of this material looks like "bad garnet" when it is retrieved from the ground. Although Mong Hsu material does have a definite place in the gem market, it is not the same as "classic" unheated and unaltered Mogok material. Unfortunately, no other lab in the world, except AGL, makes this distinction. From a buyers standpoint this is a pivotal and financially significant issue.

According to locals, even the one time "drug lords", now called the "Peacemakers", have jumped ship and are using their ill-gotten gains to acquire mining leases that have transformed them into legitimate businessmen. This government move to settle the on going problems with the armed militia of drug merchants has temporarily provided a more peaceful environment in Burma. Unfortunately, it is like making a deal with a Pit Bull; you never know when your relationship is going to turn ugly.

In the final analysis, fine gems are still rare and stones that exhibit an ideal balance of color, clarity and cutting are exceedingly difficult to find. The pressure on price continues to escalate as more buyers turn their attention to un-doctored material and the increasing desirability of "classic" material instead of the enhanced product that tampers with the definition of rarity.


(Alan Roup is the owner of Gem Namibia, the new Orange Mandarin Garnet mine in Namibia. The Gemstone Forecaster is proud to offer this exclusive interview.)

By Robert Genis

Gemstone Forecaster: Could you describe your background in geology?

Alan Roup: I have been involved in the mining of gemstones in Southwest Africa for over 30 years. I am a graduate geologist. My background is geology and chemistry. I worked for the Rhodesian Geological Survey. I also worked as an oil geologist for the Israel Geological Survey and for an Oil Prospective Company as an oil geologist. I was a consultant geologist in Namibia in the mid-sixties. I opened the first blue tourmaline mine in 1964, when I found 600 kilos of rough. In 1969, I started a major amethyst mine which produced material until 1985.

GF: Is it difficult to find Mandarin Orange Garnets?

AR: Our mine is extremely isolated. We have to bring in parts, machines, food and radios to maintain contact the rest of the world. The mine is located in a mountain nearby our base camp. Mining these garnets is extremely dangerous and costly. We have to remove significant quantities of over-burden in order to find the mandarins.

GF: Do you have any local tribes to deal with?

AR: There are almost daily episodes with the local Ovahimba Tribe. They are extremely primitive, and I could write a book!

For example, the Ovahimba Tribe have no conception of what the word "government" means. When we arrived in the area, we told them we had bought a claim, registering it with the Ministry of Mines and we were absolutely legally entitled to mine there. That meant zero to them-only if their ancestors agreed, we would be allowed to stay. Otherwise, we would have to go. We spent about three hours outside in the desert one dark night, sitting on our haunches like they do, while they prayed and asked their long lost ancestors if we could stay. Luckily, the answer was yes! But we were required to bring alcoholic drinks to "thank the ancestors", while the living finished off the entire stock of beer. Had we known, we would have brought the beer in the beginning, without going through three hours of make-believe!

GF: I understand you bought the new mandarin orange garnet mine from a Namibian?

AR: Yes, I bought one claim (600 meters x 300 meters) from an African without any real indication that we would find any gem quality spessartine garnet. It took us three months of exploration before we found one gemstone!

GF: Could you give the readers a mental image of the mine site? What did you do to prepare the site for mining?

AR: When I bought the claim, no infrastructure existed. Today we have a dirt landing strip as we fly in a Cessna 182. We have built housing for 22 staff members and two managers. We also have hot or cold water, but the water is salty. We do have a radio and a flush toilet. We have a kitchen and a dining room for the staff and a cook to prepare meals. We build dirt roads where necessary.

GF: Do you plan to do any more improvements to the site?

AR: We are about to drill for water. Eighty per cent of our water is salt water. The rest is shared with the zebras, who urinate in the water while they drink.

GF: How far is it from a major city? How do you get there? By plane or by road?

AR: Windhoek, the capital is 1000 kilometers away. It takes three days to get there with a 4x4 vehicle or three and a half hours by the Cessna 182.

GF: What are the temperatures at your mine?

AR: This is a very, very hot area. In the summer temperatures get over 40 degrees Celsius. In the winter it gets down to 15 degrees Celsius.

GF: Does it ever flood or rain at your site?

AR: It only rains in the summer. So far this season we have had about 12 mm of rain. It does not flood because of the mountainous terrain.

GF: Could you describe the mining process? Do you use dynamite? Bulldozers?

AR: I am very anti-bulldozer. I use front-end loaders, compressors, and then dynamite-but not in the actual formation. Bulldozers are messy, slow and crush what is underneath-we prefer wheels.

GF: Could you break down your mining production into melee vs. carat size stones?

AR: Most of our production is melee up to 1/2 carat finished size. Possibly 90% is melee. Gem qualities occur in potatoes not crystals, very much like tsavorite of East Africa. Potato is a local word used to describe a group of "re-melting" orange garnet crystals. Potatoes show no crystal symmetry whatsoever. Potatoes look like potatoes, but are actually a total garnet composition.

GF: Are the Japanese (Far East) your major customers? Do Europeans like the stone?

AR: Far East are the best customers. Americans and Europeans are now starting to become important.

GF: I know you were also involved in discovering the first mandarin orange garnet site in Namibia. What is your opinion of the gems from the first site vs. your new mine?

AR: I started the first mine on the Kunene River. My present mine is 28 kilometers south of the river. The first mine only has crystals. The material is somewhat orangy/yellow vs. my new mine where I can best describe the colors as orange/red or aurora red.

GF: Sometimes new gems are hard to market internationally. What has been your experience? Do you think the gems will become more accepted as years go by? Do you think mandarin orange garnets will be the next tanzanite?

AR: Acceptance of the mandarin is growing rapidly. The gem is not just another red, blue, or green gem. It is different and it is exciting.

GF: What are the largest mandarins you have ever discovered?

AR: An 11.17 fine gem was the largest!

GF: Most of my readers are collectors. Do you think this stone merits collecting?

AR: Absolutely. The stone is very, very rare. It is difficult to find and certainly worthwhile collecting the largest and best examples.

GF: Thank you Mr. Roup. Please keep us informed of the latest news from Namibia.

National Gemstone presently has a few carat-sized Mandarin Orange garnets in stock. Call 1-800-458-6453 if you want to own one of these rare collectible gems.


Top Web Sites For Financial Information
The following was written by R. Michael Terry, CFP, Money Magazine On-line about National Gemstone's Internet web site. Thanks.

"National Gemstone. A sparkling page. Literally. While investing in gems is probably not advisable for the average investor, if you'd like to learn something about valuable gems and enjoy looking at pretty pictures on the net this is worth investing some time! Some very useful information about gems and investing in gems for fun and profit is available here, but more to my liking are the spectacular gifs of stones in the Smithsonian Gem and Mineral Collection."


Jackie Kennedy/Onassis Auction
The L-color, VS2, marquise-shaped, 40.42 carat diamond sold for $2.59 million during Sotheby's auction. The stone was estimated to sell between $500,000-$600,000. The diamond was the Lesotho III, one of eighteen gems cut from a 601-carat rough diamond. It was discovered in 1967 in Lesotho in South Africa. The rough was originally purchased by Harry Winston. It was exhibited at the Smithsonian Institute in Washington, D.C and the Museum of Natural History in New York before being cut into 18 gems. Al Lippert, the ex-Chairman of Weight Watchers bid for his friend, Anthony O'Reilly, the chairman of H.J. Heinz Co. Mr. O'Reilly is going to give the stone to his wife, Greek heiress Chryss Goulandris. He attached great symbolic value to the ring because of the Goulandris family had connections with the Onassis family.

Christie's Auction Results-April
Christie's sold over $41 million during its April Auction. Of the 521 lots offered, 403 or 77% were sold.

  1. A private collector paid $5,667,500 for a circular-cut diamond of 44.18 cts., D color, Flawless.
  2. A private collector paid $2,972,500 for a pear-shaped diamond of 45.02 cts., D color, Flawless.
  3. A private collector paid $1,553,500 for a diamond necklace.
  4. A private collector paid $1,328,000 for a pair of pear-shaped diamond pendants of 20.27 cts. and 16.66 cts.
  5. An anonymous buyer paid $1,328,000 for a rectangular-cut diamond of 21.81 cts., D color, Flawless.
  6. A private collector paid $992,500 for a Fancy Intense Yellow and colorless Diamond Line Necklace.
  7. A US private paid $948,500 for a suite of cabochon sapphire and diamond jewelry.
  8. A UK private bought a diamond necklace by Harry Winston from the collection of the late Joanne Toor Cummings. He paid $794,500.
  9. A Hong Kong private paid $794,500 for a pair of heart-shaped diamond ear studs of 10.10 cts. and 10.03 cts., D color.
  10. A private collector paid $772,500 for a pear shaped diamond ring of 16.38 cts., D color, Flawless.

Christie's Auction Results-May
Christies sold $49,841,814 of gems and jewelry or 73%.

  1. American Siba Corp. paid $3,043,496 for a Fancy Intense Yellow diamond brooch of 102.07 carats by Cartier, 1953.
  2. American Siba Corp. paid $1,970,325 for a Fancy Vivid Yellow diamond necklace.
  3. A Saudi Arabian private bought The Blue Princess, a sapphire and diamond necklace with a cushion-cut sapphire of 113.72 carats for $1,791,463.
  4. International Trade purchased a pair of diamond earrings by Harry Winston, each set with a pear-shaped diamond at 16.71 and 16.88 carats. The price was $1,433,740.
  5. International Trade also bought a rectangular-cut diamond ring of 20.81 carats, D color and Internally Flawless. The price was $1,433,740.
  6. American Siba Corp. paid $1,433,740 for a pear-shaped Fancy Intense Blue diamond of 4.27 carats.
  7. International Trade paid $1,344,309 for a cabochon emerald and diamond pendant brooch.
  8. International Trade paid $1,344,309 for a ruby and diamond necklace, circa 1905.
  9. Swiss Trade bid $646,748 for a marquise-cut diamond ring of 15.51 carats, D color, VS2.
  10. New York Trade bid $390,244 for a cushion-shaped Fancy Gray Blue diamond of 5.74 carats.



Current Market
Presently, there are severe shortages of round diamonds between 1.00 through 3 carats. Strong market demand for 90 pointers. F-G Colors, VS-SI2 clarity are extremely hard to locate. There have been small price increases in these goods. Investors are starting to buy large D-IFs. Rough prices are high and shortages are putting increasing pressure on polished buyers to pay more. Severe shortages of Russian rough crystals have pushed up prices for princess, radiant, emerald, and pear shapes. Expect prices to increase.

Argyle Diamond Decides to Leave DeBeers Cartel, by Neil Behrman (Wall Street Journal-June 10, 1996)
London-Argyle Diamond Mines Joint Venture, the Australian diamond producer, is withdrawing from DeBeers Centenary AGÕs cartel.

"We believe that we will get a better deal if we sell our diamonds independently," says Andrew Murray, manager of corporate services in Argyle. "The mine produces 40 million carats of diamonds a year, or 37% of global output," he said. A carat equals a fifth of a gram.

"We are disappointed that Argyle is not renewing its contract," a DeBeers spokesman said. "Yet the pull out must be put in perspective," he said. "The value of Argyle's production, at $360 million only accounts for 6% of the global $6 billion diamond market," the spokesman said.

Diamond dealers in London and Antwerp, Belgium fear that there will be a period of "market turbulence" as Argyle and DeBeers jockey for market share. "Prices of the cheaper diamonds that Argyle mainly produces could slide," said Marcel Grunhaut, managing director of Double MG BVBA in Antwerp. Overhanging the market is an Argyle stockpile equivalent to one year's production, dealers said.

Despite the low value of Argyle's sales, dealers regard this withdrawal as a blow to the DeBeers cartel, which controls around 75% of the global diamond market. Recently, the cartel renewed a contract to sell diamonds on behalf of Russia, the producer that mines the most valuable gems. But the pact is less favorable to the cartel than the previous one, dealers said, and details are taking a long time to be finalized.

"Moreover, RTZ CRA Group, the joint United Kingdom and Australian mining company, holds stakes in Argyle and Amber Resources Ltd., a promising Canadian diamond producer," said Marcel Pruwer, an Antwerp diamond dealer and consultant. "It is likely that an independent Argyle marketing operation will sell Canadian diamonds when expected large-scale production comes on stream within a few years," he said.

Inside Job at Argyle
Between 1988 and 1993, $50 million worth of diamonds may have been stolen from Australia's Argyle diamond mine. Argyle's security chief, his wife, and a race horse owner are charged with the crime. Apparently, the diamonds were never entered into the computers, so there was no official record of the stones. What tipped off Argyle was when several rough pink diamonds showed up in 1989 in Geneva and Antwerp. Since Argyle is the producer of the pinks, they knew the stones were Australian, and they started an investigation. The main stone that led to the arrests was an 11 carat light pink. For years the Australian police investigated the theft with no results. Finally, the security chief and his wife admitted they were stealing diamonds.

DeBeers Sales Increase
DeBeers reported an 11% increase in sales for 1995. Earnings were $624 million, up from $560 million. Sales were up 7% to over 4.5 billion.

DeBeers and Russia
DeBeers and Russia have reached an agreement which will close most of the loopholes that allowed $1.8 billion worth of rough diamonds to leak into the world diamond market the last three years. Almazi-Rossii-Sakha or ARS is now the only Russian agency entitled to export Russian diamonds. Most of the outside sales came from Komdragmet and Techalmaz. These agencies are no longer allowed to market Russian diamonds. The Director of Komdragmet was fired by Boris Yeltsin. He was under investigation for the disappearance of $88 million worth of diamonds in San Francisco.

These changes were the result of the senior members of the Russian government who wanted to take control of the Russian diamond industry. The agreement is expected to hold even if there are major changes in the Russian Government after Russia's June presidential election.

Russia did win the right to sell up to 12.5% of their rough outside of DeBeers, up from 5% on the 1990 agreement. In return, DeBeers received the right to Russia's run-of-mine production instead of receiving what was left over. The new agreement sets a Russian sales quota at $1.2 billion. From the first $600 million, DeBeers has a right to the complete run-of-mine material. The Russians can take 5% and sell it on the open market. The second $600 million is divided into two groups: the remainder of the run-of-mine material and rough of the Russian stockpile. ARS will be able to sell 20% of this half on the open market.

Diamond industry leaders hailed this agreement as an important step in restoring confidence and stability in the diamond market.

Vyacheslav Shtyrov, the President of Almazi-Rossii-Sakha, or ARS, wants to become another DeBeers. ARS is already the second largest diamond concern with annual production sales of $1 billion. One problem for ARS is it is very difficult to raise capital. The company cannot sell shares, issue securities or mortgage property. Also, the ownership of ARS is complex. The Russian government owns 32%, Sakha own 32%, employees own 23%, and eight Sakhan regions own 8%, and 5% is owned by the Social Security for Veterans. ARS owns no mines but leases them for 50 years. ARS is short of cash but hopes to set up a multi-national corporation to compete with DeBeers.

Colored Diamond Exhibit
In Omaha, Nebraska the following gems were shown:

  1. The Golden Jubilee-A 545 carat golden rose cut. The diamond was 755 carats when discovered at DeBeers Premier mine in 1986. It has been on display at the Jewelry Trade Center in Bangkok. After a limited world tour, Henry Ho will present the diamond to the King of Thailand to celebrate his 50th year of rule.
  2. The Lazare Kaplan Diamond-a 620 carat rough diamond.
  3. The Fancoldi Collection-32 Fancy rare colored diamonds.
  4. The Stanley Kahn Diamond-a 4.25 yellow diamond discovered in 1977 in Arkansas.

GIA Colored Diamond Grading Reports Up
With the advent last year of a new system for grading fancy colored diamonds, demand for grading reports for these stones has skyrocketed 75%. The GIA plans to expand the New York facility to accommodate this demand.


The most famous sapphire mines are either played out or unreliable. Sapphire mines in Kashmir have been depleted since the 1920s. Mining in Burma is difficult to access. Cambodia and Thailand no longer possess much material worth mining. The leading source today is Sri Lanka, but the supply is sporadic. Vietnam may be a promising source in the future, but so far the quality has been only commercial. Recent reports also indicate small intense blue sapphires are being mined in Laos.

Recent production from Tanzania lead many to believe Africa may be the next great source of sapphire. The finest blues look like the finest Sri Lanka material. Rwanda is also producing sapphire. The highest quality sapphire being produced is Madagascar. They tend to be between 1/2-1 carats, and they respond to heat treatment. They are being described as between Sri Lanka and Kashmir quality and can be priced over $1000 per carat. Due to the fact bribes must be paid in Africa and sapphire is found only with hard-rock mining, expect these prices to increase.

Australia may play a more vital role in sapphire production. Although Australia is known for low quality sapphire, heating technology is helping their production. The Redstone area in New South Wales is producing higher quality rough. For many years the Thais would buy the good Australian rough and resell it as Thai or Cambodian goods.

Bangkok Report
Recent reports indicate that prices are up for all qualities of blue sapphire. African sapphire is now mixed in parcels with Sri Lanka stones. Ten carat Thai blue sapphires, 4.5-5.0 color, clean were $2500+ per carat. Standard 2-3 carat sapphires were extremely high.

Calibrated spinel is a new product in Bangkok. All of these stones are below a carat. Fine clean Burma spinel over a carat are not available. There is some production of included carat size Spinel.

Mong Hsu ruby dominates the ruby market. Thai ruby is not being shown. Very little production of Mogok Burma ruby in Thailand. Tanzanite is still a hot stone.

In April, a guerrilla ambush killed 31 government soldiers and wounded 15 others. The insurgents set off dynamite while a convoy of six trucks passed over a road near the trans-Andean pipeline. The attack occurred 560 miles southwest of Bogota. The 150 guerrillas also threw grenades at the convoy. In May, FARC killed 16 in Northern Colombia. The Colombian government issued a statement that the attacks were committed by the Revolutionary Armed Forces of Colombia (FARC). FARC has robbed banks and extorted money from wealthy landowners. They have made millions in kidnapping ransoms. FARC guards cocaine plantations and supplies drug cartels with cocaine paste. FARC was founded in the 1960s to fight for the poor. They are the largest of Colombia guerrilla groups with an estimated 12,000 fighters. The guerrillas have intensified their urban activities. They have tried to impose three-day strikes by threatening to bomb buses, banks, stores, and administration offices. There is now a fear among city residents in Bogota. In Colombia the guerrillas, the paramilitary, the drug traffickers, and the military are all competing for political control of the country. There is a power vacuum due to the fact President Samper is under siege due to the growing scandal over campaign contributions from drug dealers. Five members of Samper's cabinet have resigned.

FARC is using the scandal to escalate operations and is demanding Samper's resignation. Drug dealers are using the disruption to consolidate new networks and reignite narcoterrorism. The military and paramilitary are using the state of emergency to spread more violence. There is no end in sight for this conflict. Do not look for any increased emerald supply during this crisis. Those clients of National Gemstone with special orders may have to wait longer. In the 25 + years we have been monitoring this country, Colombia has never been in such a precarious political position.

Kenyan Tsavorite
There are only a few tsavorite dealers left in Nairobi. Most have left for Tanzania, which produces a great deal more material. Most tsavorite discovered today is rough between .02 and 5 grams (5 grams equal one carat). The largest tsavorite recently discovered was a 15 carat piece of rough, that would cut into a 4-6 carat gem. Gangs continue to invade the mines and some supervisors have been killed. Many miners are also being attacked between the mines and Nairobi

The Tanzanian government has recently reopened the mines after a seven-week shutdown. The main mines that were closes were the Tundura, where corundum deposits were discovered last year. The government will no longer license foreign mining companies. Only Tanzanian nationals will be allowed to own mining rights. The new rules were designed to prevent excess gem production. Further, the closing time allowed the government to formulate regulations regarding the illegal mining and smuggling. The problem is very little of the rough deposits of tanzanite, corundum, or diamond is cut in Tanzania. The government believes 98% of gemstones found in Tanzania are smuggled out of the country. The failure to collect taxes on Tanzania's mineral wealth results in a poor infrastructure. Government officials want to build a gemstone industry within Tanzania's borders. The problem the Tanzanian government faces is how to regulate the gemstone industry without shutting off investment.


Burma and Thailand have recently opened their borders for the first time since 1994. The Thai military were charging vehicles $200 to cross into Thailand from Burma. According to the new agreement, the borders will remain open for two years. After the two year trial, the borders will remain open unless either side petitions for the closing of the border. The soldiers and police on both sides can make more money if the borders are closed because of payoffs. Thai gem dealers feel they can buy Burma goods below the market when the border is closed because when smugglers enter Thailand clandestinely, they have a vested interest in selling quickly and recrossing before they are caught. Therefore, we should expect to see more Burma goods, but at a higher price. The Burmese government has struck a new business dealer with Kuhn Sa, the notorious drug smuggler. Kuhn Sa is wanted by the US Government for drug charges. Kuhn Sa surrendered to the Burmese Government in 1995. He was guaranteed by the Burmese Government that he would not be extradited to the US. In return, he disbanded his militia and handed over his strongholds to the Burmese Government. He now has set up legal enterprises in logging, gem production, and petroleum. Kuhn Sa is now a major force in the gem business. He has a gem cutting operation in Taunggyi, capital of the Shan State. Reports also indicate Kuhn Sa has resumed his involvement in smuggling drugs. He is allegedly building a heroin factory on the Mekong River, where it will be easy to smuggle gems and heroin to China.

The rebel Khmer Rouge are fighting the Cambodian government forces. The Khmer Rouge currently control the Pailin area, 12 miles from Thailand. The Khmer Rouge finance their guerrilla activities from gem mining. The Thailand government is friendly to the Cambodian Government. The Khmer Rouge can no longer depend on the Thais to buy their ruby and sapphire. Numerous Thai gem dealers have been killed by the Khmer Rouge in Pailin. The Khmer Rouge now smuggles the goods to Thailand and sell the stones through anonymous surrogates. Although the Cambodian military continues to attack the Khmer Rouge, they are fierce guerrilla fighters. Do not expect any production from this area until the Khmer Rouge are defeated by the military.

Vietnam has recently announced the creation of the Vietnam National Gold and Gem Corporation to control the surveying, exploration, and extraction of gems in Vietnam. This state enterprise is to centralize the gem mining industry. New law guarantees that investors will retain the right to mine deposits they discover. Investors are required to process the gems domestically, help build the infrastructure, and restore the environment. Most mining until now has been done by State companies and profits have been non- existent. Although this sounds promising, Vietnam is in a state of national frenzy. Recently the government allowed the destruction of foreign videos, compact discs, magazines, and the destruction of foreign advertising signs. There are reports of foreign businesses being nationalized. Do not expect any gem production from this country.


Rare, Precious, Unique to Utah
Utah Salt Lake Tribune April 15, 1996
By Liz Peterson
Submitted by subscriber F.B. of Colorado.

DELTA- On Main Street in this central Utah town is a store few on lookers would guess contains a collection of one of the rarest and most expensive gemstones in the world. Housed in a former bank, Tina's Jewelry and Minerals contains a hodgepodge of gold and silver jewelry, engagements rings, jewelry-repair services, rock art and the only retail selection of red beryl jewelry in the United States. Proprietor and jewelry artisan Tina Nielson stores tray upon tray of red beryl gems - ranging in color from clear rose to magenta to blood red - in a safe in the store. Nearly 20 years ago, Nielson's uncle, a self-taught gem cutter, realized the potential value of crystals extracted from the Violet Claims in nearby Beaver County. His hunch proved right when gemologists determined the claims contain the only gem-quality red beryl in the world.

Red beryl is a million times rarer than its cousin green beryl - commonly known as emerald. At the Violet Claims, crystals are found in matrix formations dispersed throughout a volcanic rock called rhyolite. Golden Spike Gem and Mineral Society board member Erol Benson called red beryl one of the most remarkable materials to come out of Utah. Even though varieties have been found elsewhere, the Utah Wah Mountain Range mine is the only to produce crystal suitable for faceting - or cutting - and use in jewelry. According to Benson, a retired lawyer in minerals and mining, although Utah is rich in minerals, not many of those minerals are gemstones - the only others are sunstones and topaz, the state gem.

Since Tina's opening in 1985, rock and gem connoisseurs from around the world have visited to find out more about the rare stone. Nielson estimates at least 90 percent of the red beryl business is from outside the United States, including the top client, a jewelry salesmen from Japan. Like other precious gems, the cost of a faceted red beryl depends on its cut, clarity, color, and number of carats. Nielson and family members use emerald costs to price red beryl, charging $400-$20,000 per carat. Nielson recalls the family's first sale, an on-site purchase by a New York man who paid with a $225,000 check for an uncut crystal. When a Delta banker called chase Manhattan Bank in New York to verify sufficient funds, the banker was told, "His checks are always good."

Last spring at a Geneva, Switzerland auction, a 1.79 red beryl cut by Nielson fetched an advertised price of $15,000. Until recently, Nielson, who learned from her uncle to facet on red beryl, cut all of the stones in the store. Due to growing market demand, the stones are now sent to Sri Lanka, Colombia, and other countries experienced in cutting emeralds.

Nielson's family is one of 275 owners of active, small non-coal mines registered with the state of Utah's Division of Oil, Gas, and Mining. Twenty-one of the mines, like the Violet Claims, are registered by Millard County companies. "The entire western United States is mineral-rich, and Utah is no exception," said Bruce Tripp, a senior geologist for the Utah Geological Survey. "Utah is especially rich", he noted, "in mineral diversity."

According to Wayne Hedberg, a permit supervisor for Gas and Mining in the state, up to 450 small mine permits are on file at the state office, but many of those are inactive. "There are a number of families just like Nielsons that own small mines. Some make it big, but most have not," he said. "The desire to 'make it big' adds drama when Utah's 'mom and pop' operations are left to children who feud over how land should be divided or sold," said Tripp.

While Nielson's family has not yet encountered these exact difficulties, the gem business has not been without adversity. "One problem was trying to sell red beryl - the family had to literally create a market by attending trade shows and publicizing through trade magazines and other media," said Nielson. She calls her father the "PR guy." "Other gems have thousands of years of advertising. They are even mentioned in the Bible. We have to compete in the same market with all those stones," she said. And even though the stone's rarity adds to its value, it makes meeting a large market demand impossible - there is not enough product. Ten years ago, for example, the family had to to turn down New York - based Tiffany and Co. due to lack of supply. Nielson can recount several times when bigger, more "sophisticated" companies attempted to intimidate or take advantage of her family. "People come in and think because we are from a small town, we're stupid," she said. She attributes her family's survival in the business to integrity and stubbornness. "It is a lot harder to make a living in a small town. We do not have as much to take for granted. If you succeed in business, people know it is because of hard work," she said. She puts in 8 to twelve hours a day at her store to keep up with the demand of local jewelry customers as well as the red beryl market.

Her family is considering selling the mine. Utah mining giant Kennecott is drilling core samples in the area with the option to purchase. Ken Hecker, director of planning and business operations at Kennecott, said the decision whether or not to buy the Violet claims will likely be made by next spring. Hecker said Kennecott has been exploring gemstone mines only the past five years and is also exploring a diamond mine in Canada.


The Intelligence Authorization Act of 1996 now allows the FBI to obtain key information about a person without a judge's permission. The FBI can obtain the information if they suspect someone of being a spy or a terrorist. They can retrieve credit information which includes a person's employment history, the names of spouses, and a list of lenders. The new law requires the credit bureaus to keep the information secret from the suspects.

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