Aims to increase coloured gemstone business in India
Fura Gems, the new entrant into the mining and marketing sector, intends to script a new destiny for the coloured gemstone industry. SHANOO BIJLANI reports.
Fura Gems Inc., the coloured stone mining and marketing company that was founded in January 2017, announced that it was actively looking at organising the gemstone industry and aiming for an 8-10% share of the global $2 billion coloured stone market in the next three years. At a recently held press conference in April, Dev Shetty, president and CEO of Fura Gems also noted, “We will take the India story seriously, and look to enlarge our portfolio.
He added that the mining and marketing company was also ready to start exploring the Bunder diamond project (in Madhya Pradesh) that was earlier explored by Rio Tinto, which gave up its mining rights licence to the state government after putting in over $90 million. “The government may soon look for investors and float tenders. We would like to help the government further the Make in India concept.
“As a part of our larger expansion strategy, India is one of the top three markets for us. We are aggressively looking at the Bunder Diamond project in Madhya Pradesh and projects in the states of Jharkhand and Odisha, which have a huge potential in terms of mineral deposits. We will be exploring mining acquisitions in these regions and will be working closely with the central and state governments. Given our experience, we are confident of reducing India’s coloured gemstone imports substantially.”
While Fura Gems was ready for mining acquisitions, it revealed that it was also in talks with a joint-venture partner for the same. “However,” Shetty noted, “it all depends on the financial terms offered by the government for Bunder.”
According to Shetty, if all goes well, Fura will begin with an output of just 1.5 million carats per year and gradually proceed to mine about 3 million carats annually. For the first two years, Fura was willing to invest $30 million, which should turn cash positive in the third year.
Other mining acquisitions
Headquartered in Toronto, Canada, with its administrative office located in the Almas Tower, Dubai, Fura is listed on the TSX Venture Exchange. Shetty commented that being listed means “one is forced to convey good or bad news to its stakeholders. Discipline, transparency, ethics are important tenets for us. Some 50% of the world’s emeralds come from Colombia in terms of value, yet there is not a single leader with an ethical route to the market. Acquiring Coscuez was a prize catch for Fura. We want to tell real stories about the region and change people’s perceptions of the land – that is famous for its emeralds, coffee and chocolate.”
The mining company is engaged in the exploration of resource properties in Colombia and owns a 76% interest in the Coscuez emerald mine in Boyacá, Colombia, and a 100% interest in the emerald licence ECH -121. Fura is also involved in the exploration and mining of rubies in Mozambique through its 80% effective interest in the four ruby licences that it acquired in November 2017.
The bulk sampling programme at Coscuez has been initiated and a total of 30,000 tons of material from the mineralised body are expected to be collected in the first phase of the programme on or before December 31st 2018 using existing tunnels. This, in turn, will give a tremendous boost to Fura Gems’ operations in India since 60% of the world’s emeralds are cut and polished in the country. During the initial phase of bulk sampling, a total of 1,720 carats of emeralds were mined, out of which 826 carats were high quality emeralds.
Shetty added that this further confirms the quality of the Coscuez emerald mine. “We will continue to build our geological knowledge of the licence area and also strive to modernise the Coscuez emerald mine.” True to its word, Fura is the first mining company in the region to offer salary and health benefits to its initial workforce of 120 hired by the company. “The staff has already been given a permanent contract, and trained in safety and health standards. Strangely, nobody who worked there earlier was ever paid a salary, and the concept is new to the locals,” he added.
Fura has adopted a business-tobusiness marketing strategy and will sell only rough to gemstone and jewellery manufacturers. It will also aim to educate retailers about the various treatments, disclosures and so on in order to organise the industry. Rupak Sen, vice president – marketing and sales of Fura Gems said, “India is the largest cutting and polishing centre for emeralds in terms of volume. There is a growing demand for emeralds in the Indian market and we intend to capitalise on the same by strategically organising the sector.”
Shetty added, “Our gemstone industry needs to evolve and the biggest challenge we face is disclosure of treated versus untreated stones to bring in the transparency leg.”
Fura has also entered into agreements to acquire four ruby licences in Mozambique and has started with the exploration process. The bulk sampling will commence in July 2018. The mining company owns 80% effective interest in these ruby licences. “We love to operate on scale, so that we can support the trade with consistent supply,” Shetty rounded off.