File: Welcome to EOSC 118

Module A. Diamonds and Due Diligence

Lesson 1 - Introduction to EOSC118

Welcome to EOSC 118 Earth's Treasures:

Gold and Gems!
Welcome to EOSC118 - Earth's Treasures: Gold and Gems! We are pleased to have you all here
for this very new course and hope you are as enthused as we are!
This course will introduce you to the scientific world of gemstones and precious metals. We'll
touch on where gems and precious metals crop up in our everyday life, learn background
geoscience concepts to put course content in context, and dive into the exciting realm of precious
gemstones and metals.
In this Distance Education section, you will be learning independently; you will progress at your
own pace, and study and learn in your own time and chosen place. You decide when and where
you want to actively be in class, how to study, and when to write the Quizzes within the 36-hour
window they are available.
What will it take to successfully complete this course? You will need to A) read and understand
the course materials, including the online course notes (Learning Modules) and assigned
textbook readings; B) ask (a lot of) questions on the Discussion Board; C) write all 3+1 Quizzes
(plus the practice quiz); and D) write and pass the Final Exam.
As your Course Instructors, we (David Turner & Tashia Dzikowski) will guide you through the
Course Material. We are a resource for more and detailed information on the concepts and issues
we will be discussing in class and will be actively in class much of the time. We'll also have a
fantastic set Teaching Assistants for the course, and further assistance is available 24/7 on our
Discussion Board (DB) and by email.
Again, Welcome to class! We look forward to this entire term with you!

File: Course Overview

Module A. Diamonds and Due Diligence
Lesson 1 - Introduction to EOSC118

Course Overview
EOSC118 is divided into four exciting Modules centered on the title of the course: The Earth's
Treasures.
The first Module, Diamonds and Due Diligence, covers three main topics:
1. Aspects of the jewellery industry and current events
2. Basic science to help understand what precious gems and metals actually are
3. The world of diamonds!
The second Module, Colour from the Cosmos, covers two main topics:
1. The nature of colour and light, and exploring the tools of the trade
2. Coloured gems: emeralds, rubies, sapphires, and more!
The third Module, Mining and Major Metals, covers three main topics:
1. Gold!
2. Platinum and its precious relatives
3. Mining of gems and precious metals and its implications
4. Silver and Precious Metal Alloys
The fourth Module, The Final Steps, covers a varied set of topics:
1. Production aspects of the jewellery industry, especially in Canada
2. Numismatics
3. Self guided field trip

File: Course Goals

Module A. Diamonds and Due Diligence
Lesson 1 - Introduction to EOSC118

Course Goals
These are the course goals for EOSC 118 Earth's Treasures: Gold and Gems.
By the end of this course, you should be able to:
1. recognize valuable gems and metals
2. apply this knowledge in your personal gem and metal investments
3. appreciate the processes needed to discover, mine, add value (facet and polish), and
market gems and metals, as well as their uses in everyday life
4. describe and discuss the gem industry in Canada and how it relates to the industry in the
rest of the world
5. relate economic development in British Columbia and Canada to past gold rushes and
future discoveries
6. sharpen your observations of nature
7. make the connection between science and everyday life
Each lesson or set of lessons also have their own learning objectives. Be sure to review these
prior to reading the material and also afterwards to assess your learning.

File: Course Materials

Module A. Diamonds and Due Diligence
Lesson 1 - Introduction to EOSC118

Course Materials
The entire course is delivered online on Vista. All the information for this course will be
provided in the Online Course Notes (Learning Modules), assigned textbook readings, videos,
and movies.
The Online Course Notes (Learning Modules) is published here on Vista - Click on 'Learning
Modules' on the Home Page. You may read the Notes online or download the compiled form in
html or pdf format. Note that Modules will be made available as the course progresses.

The required textbook for this course is:

Rock and Gem: The Definitive Guide to Rocks, Minerals, Gems, and Fossils Ronald L.
Bonewitz, Margaret Carruthers, and Richard Efthim 2008, DK Publishing, Inc., 360pp. ISBN-13:
9780756633424
The Course Textbook may be purchased at:

"Pacific Museum of the Earth" Gift Shop in the EOS department building. The hours of
the gift shop are posted here. While you are there check out the cases of mineral and gem
specimens - this makes a good introductory 'field trip' to EOSC118!

Order online at major book resellers, such as ABE Books or Amazon

The course makes use of some streaming videos and movies, and are available via Vista or via
sources outside the Vista environment. You will be prompted to watch the videos within the
lesson in which they are applicable. Videos for EOSC118 include (you don't need to watch them
now...):

"Queens of Diamonds" (2005)

This documentary follows the dramatic adventures of two women and their high-stakes quest to
develop Canada's next diamond mine in Nunavut. We follow them from their offices in
Vancouver to the corporate boardrooms of North America and finally to the trenches of Canada's
far north. By journey's end they will either be crowned the new "Queens of Diamonds" or they
will be forced to start back at square one.
Viewing time: 47 minutes
a Telefilm Canada documentary

"Full Circle with Michael Palin, Episode Nine:

Peru/Colombia" (1998)
Full Circle with Michael Palin is a British Broadcasting Corporation (BBC) documentary of
Michael Palin's unusual and interesting trips to various places in the world. In Episode nine,
Palin visits Coscuez, Colombia, the largest, richest and most dangerous Emerald mine, and home
to some 6,000 people. The Coscuez mine is literally hundreds of years old but its recent history
has been filled with violence. The mountain in which the mines are located was fought over by
rival bandit groups and 3,500 people were killed in the struggle for control. Today, of those who
live on the mountain, only about 1,200 are employed by the private company that has the mining
concession from the government.

Viewing time: 4:42 minutes

a BBC documentary

File: Quizzes, Final Exam, and Course Grade

Module A. Diamonds and Due Diligence
Lesson 1 - Introduction to EOSC118

Quizzes, Final Exam, and Course Grade

Your Course Grade will be based on your three (3) best Quizzes (40% total) and a
comprehensive Final Examination (60%). Here is how your Course Grade will be calculated:
Course Grade = 40% of Quizzes + 60% of Final Exam + Bonuses
The Quizzes will be delivered online and will include questions covering the online Course
Notes, the assigned readings, and the required videos and movies. Each Quiz will be 30-minutes
long and will include up to 20 multiple-choice questions. There are 4 quizzes but only your top
three results will be used to calculate the portion for your final mark.
The Final Examination will be a paper-based exam to be written in-person at the UBCVancouver Campus or at other Exam Centres outside of UBC. Like the Quizzes, the Final Exam
will also cover the online Course Notes, the assigned readings, and the required videos and
movies.
The Final Exam will be 2.5 hours long and will include 100 multiple-choice questions covering
all the four Modules.

Schedule Of Assessments (Quizzes And Final Exam)

Evaluation (Course
Notes, Videos, Movies)

% of Course Grade
Coverage

3 of 4 Quizzes (online, 20 Q1: Intro material

Qs each)
Q2: Diamonds, Beryl, Corundum
Q3: Other gems, colour, tools

40 % (13.33+13.33+13.33)

Q4: Module C
60 %
Final Examination

Approximate Weighting By
Module:

(paper-based, invigilated,
100 Qs)
A: 25%
B: 25%
C: 25%
D: 25 %
TOTAL:
Extra Credit: Provide collaborative content for peers and
participate in student surveys.

100%
Totaling 2.5%

Please read the Course Schedule, Quiz FAQs and Final Exam FAQs for more detailed
information.
Furthermore, in order to earn a passing Course Grade, students must earn a mark of at least 50%
in the Final Exam.
The relationship between Course Grade and letter grade is defined by UBC Grading Practices.
We do not give extra make-up work, so please maintain strong study activities during the term to
help maximize the grade you earn. Keep up with the readings from the Online Course Notes.
Form study groups with fellow students.

File: How To Proceed With EOSC 118 Gold and Gems

Module A. Diamonds and Due Diligence
Lesson 1 - Introduction to EOSC118

How To Proceed With EOSC118 Gold and

Gems

Be active in class often and regularly. Check out the Course Schedule posted in the following
page and on the Home Page.
When you login to our EOSC118 website on Vista you are actively in class regardless of whether
you are at UBC or anywhere in the world.
Do these student activities while in class:
1. Read/Study Online Course Notes (Learning Modules), including figures, tables (and
captions!). Click on 'Learning Modules' on the Home Page to access the Course Notes.
2. Read/Study the assigned readings from the Textbook, including figures, tables (and
captions!). These are listed within each Lesson.
3. View/Study the required videos and movies. These are accessible from within the
Lessons.
4. Post questions and respond to questions on Discussion Board. Access the Discussion
Board from the 'Course Tools' menu on the left.
5. When available, write Practice Quizzes. These tests are not graded and are intended to
help you get a sense of the types and level of questions to expect in the Graded Quizzes.
Click on 'Quizzes' on the Home Page.
6. Write Graded Quizzes. There will be three (4) 30-minute Quizzes covering all the
modules. These are scheduled about every few weeks and are available for 36 hours.
Click on 'Quizzes' on the Home Page. More information on the Quizzes can be found in
the Quiz FAQs under 'Help' on the Home Page.

Notes and Guidelines:

1. Spend at least 10 hours/week in class. Class hours include the activities listed above and
studying your own course notes. In most Distance Education courses, the most successful
students were those who were in class often and regularly. We're all aware how our brains
can easily be saturated! To avoid brain-fatigue, spread out the minimum 10 hours/week
over 2-3 days. Students who study only a day or a few hours prior to a Quiz usually do
not retain much information and do quite poorly.
2. If you study/learn better with a highlighter and by writing your own notes, then you
should print or download copies of the Course Notes. Consult the Course FAQs for
instructions.
3. Communicate with other members of the class often and regularly. This includes the
Course Instructor (Dr. Turner), the Teaching Assistant, your classmates, and the OLT
Help Desk. Use the Discussion Board, email, phone call, and in-person consultation.

More information on how to get help can be found in the Course FAQs under 'Help' on
the Home Page.
4. Form study groups for Quizzes and the Final Exam. A 'Study Groups' Discussion topic
has been setup for this.
5. If you miss a Quiz or the Final Exam, you get a zero. So, know and follow the Quiz and
Final Exam schedule. The schedule of Quizzes and Final Exam is available in many
places on Vista.
6. If you have to miss a Graded Quiz:
1. Inform the Course Instructor in advance.
--send an email message directly to David Turner or Tashia Dzikowski,
2. Only those absences for short-term illness, emotional difficulties, family
emergencies, or specially approved UBC activities will be tolerated (as defined by
UBC policy).
3. Travel or work schedules are not accepted as valid excuses for missing a Quiz
because Vista is accessible from anywhere in the world with access to the
Internet. Quiz dates are published at the beginning of the term and you are
expected to integrate your class schedule with your trip (personal or business) or
work schedule.
4. Computer problems, Internet access issues, lost passwords, etc. are not acceptable
as valid excuses for missing a Quiz. You are expected to resolve these issues
within the 36-hour period that Quizzes are available. This does not apply,
however, if Internet access issues are related to a UBC-wide outage.
5. Medical and emotional reasons for missing a Quiz will require a note from your
doctor, counselor, or other health practitioner.
6. A make-up Quiz will only be considered upon submission of appropriate and
verifiable documentation explaining your absence.
7. Absolutely no make-up Quizzes will be administered to students who fail to
contact and make arrangements within one week after the regularly scheduled
Quiz. Extenuating circumstances that prevent students from contacting the
Instructor must be documented.
1

There is no extra make-up work, so please maintain strong study activities during the
term to help maximize the grade you earn. Keep up with the readings of the Online
Course Notes, textbook, and video/movie viewing.

File: About The Instructor

Module A. Diamonds and Due Diligence
Lesson 1 - Introduction to EOSC118

About The Instructors

Hello, our names are David Turner and Tashia Dzikowski and we will be your instructors for
EOSC 118, Earth's Treasures: Gold and Gems. Please call us Dave and Tashia.

David Turner

Hello students of EOSC118! I am still fairly new at teaching online (since 2009), however, I
have been instructing in classroom and laboratory environments at UBC and UVic since 2002. In
reality, I started my teaching life at Silver Star Ski Resort as a children's ski instructor where the
thrill of learning took place 'on the slopes' with sliding boards. Now I am fortunate enough to be
able to continue that thrill of learning 'on line' with another one of my passions: The Geology and
Mineralogy of Gems and Precious Metals!
My geoscience career has followed an exciting and winding path. I have a combined B.Sc. in
Earth and Ocean Science and Geography from the University of Victoria and earned my M.Sc. at
the University of British Columbia. My research at UBC has been focused on the very specific
geological settings of gemstone deposits and over the past ~8 years I have also been working
with the mineral exploration industry on a number of exciting projects. Tools we use in the field

and in the lab vary considerably, and it is always fascinating how tiny observations made under a
microscope can lead to big implications on the scale of mountain ranges or initiate million-dollar
mineral exploration programs.
I have worked from the deserts of Mexico all the way up to the rolling scrubland of Yukon
Territory and across to the glaciated arctic shorelines of Greenland and Nunavut. My passion for
gemstones, pegmatites, and rare metals (like tungsten and tantalum) has kept me pretty busy and
I've been privileged enough to have been involved in some unique gemstone discoveries in the
northern hemisphere. I hope to share some of my enthusiasm for gems and precious metals with
you and plant a seed of knowledge in you that grows into your own enthusiasm for the subject!

Tashia Dzikowski

Hello, my name is Tashia Dzikowski and I will be one of your instructors for EOSC 118, Earth's
Treasures: Gold and Gems this semester. I am a Sessional Lecturer in the Department of Earth

and Ocean Sciences at UBC and have been a TA for the course since its inception in May 2009.
I have also TAed other online and laboratory courses at UBC since 2004.
I completed my B.Sc. in Geological Sciences at the University of Manitoba and my M.Sc. at the
University of British Columbia. I am currently completing my PhD on the Origin of CarbonateHosted Gem Corundum Occurrences in Canada at the University of British Columbia.
Throughout my career, I have done field work in Nunavut (Baffin Island), British Columbia,
Northwest Territories, Manitoba, and Florida. I have also been on field trips in Austria, Hungary,
and New Zealand.
One of the great things about studying geology is that there are rocks everywhere and
opportunities to study them anywhere. I have found that one of the most amazing parts of having
geological knowledge is being able to reconstruct the geological history of wherever you are in
the world. Take for example Churchill, Manitoba. This area was (1) once the core of a mountain
belt (as big as the Rockies) kilometers below the surface, then (2) was eroded over billions of
years, then (3) was at the bottom of a tropical sea (I still found fossils on the beach), then (4) was
covered by kilometer-thick ice sheets from continental glaciers, and currently (5) has polar bears
running around on top of it! I am also very interested in geology because I find it amazing that
nature is able to produce spectacular things like gems and metals! It sometimes is hard to
believe that something so beautiful and perfect can come out of the ground.
I am very excited to be able to share my knowledge about geology, gems, and precious metals
with you and I hope you enjoy learning about them. Good Luck!

We welcome you to class and look forward to a very productive semester!

Cheers,
David & Tashia
dturner@eos.ubc.ca & tdzikowski@eos.ubc.ca
Here are a few pictures of field work from Yukon Territory, British Columbia and Greenland.
Enjoy!

Extracting aquamarine from syenite host rock using chain saws studded with micro diamonds.
True Blue Occurrence, Yukon Territory.

Dark blue aquamarine crystals from the True Blue Occurrence, Yukon Territory.

Faceted (cut) dark blue aquamarine gem from the True Blue Occurrence, Yukon Territory.

Greenland ice sheet and ruby-bearing rocks!

Flowing Glacier as seen from a helicopter near Revelstoke, BC.

Ruby bearing marble lens near Revelstoke, BC.

Printable View of:Lesson 2 - Famous Gemstones and Jewellery

Print

File: Learning Objectives

Module A. Diamonds and Due Diligence

Lesson 2 - Famous Gemstones and Jewellery
Learning Objectives

By the end of this Lesson, learners will:

Understand the significance and value of historic diamonds

Be familiar with the qualities and characteristics of historic rubies,

emeralds, and diamonds

Describe several examples of historic rubies, emeralds, and diamonds

(such as the Koh-I-Noor and Mogul Emerald)

List common geographic origins for historic and magnificent rubies,

emeralds, and diamonds

File: Introduction and Objectives

Module A. Diamonds and Due Diligence

Lesson 2 - Famous Gemstones and Jewellery
Introduction and Objectives

In this lesson we will get acquainted with some of the most famous gemstones and pieces of
jewellery, most of which have a significant story to tell. Through two online readings and the
supporting content found online in our first lesson we will start to obtain a good

understanding of the words and terms we use in the gem, precious metal, and jewellery world.
If you have further questions about the terms, please post your thoughts on the Discussion
Board. In addition, we will learn how to access online journal articles through the UBC
library - a great digital resource for accessing a broad range of academic literature.
A key journal that we will be accessing throughout the course is titled "Gems & Gemology",
and is produced by the Gemological Institute of America (commonly known as the GIA).
We'll learn more about the GIA and Canadian Gemological Association (CGA) in the next
activity, along with other historically significant people and groups.
Essential readings and topics for this lesson
Topic

Pages

Historic Study of the Koh-I-Noor

Diamond

Abstract, Introduction, Box A, and

Summary

Hope Diamond

Textbook: Page 125

Optional readings for this lesson

Topic

Pages

English Royal Collection of

Crown Jewels

http://www.royalcollection.org.uk/eGallery/
http://www.englishmonarchs.co.uk/crown_jewels.ht
m

Garrard & Co Crown Jewellers http://www.garrard.com/heritage/

from 1843 to 2007
Hope Diamond

http://www.si.edu/Encyclopedia_SI/nmnh/hop
e.htm

Wittlesbach Diamond

http://amnh.com/exhibitions/wittelsbachgraff.php

Now on with the gems!

File: Diamond Encrustations

Module A. Diamonds and Due Diligence

Lesson 2 - Famous Gemstones and Jewellery
Diamond Encrustations

Perhaps some of the most well-known and iconic diamonds familiar to the Western world are
those of the British Crown Jewels, which, not surprisingly, have been incrementally
accumulated over many centuries.
The Koh-I-Noor diamond (which translates to "Mountain of Light") is the centerpiece of the
collection and sits within the Queen Mother's Crown. The current weight of the stone is 105.6
carats, significantly less than the original ~186 carats. The original stone was not cut in a
fashion that brought maximum colour and fire to the stone and Queen Victoria had it recut so
as to be more of a magnificent gem. In the 38-day recutting process nearly 90 carats were lost
in exchange for a more brilliant stone. For a more complete history of this diamond we'll read
part of an article by Sucher and Carriere in a Gems & Gemology article from the Summer
2008 Volume. Read ONLY the Abstract, Introduction, Box A, and Summary.
Sucher, S.D. and Carriere, D.P. (2008): The Use of Laser and X-Ray Scanning to Create a
Model of the Historic Koh-I-Noor Diamond. Gems & Gemology, Vol. 44, No. 2, pp. 124 141.
Click here to download the Sucher and Carrier (2008) article.
The Crown Jewels are also home to faceted pieces of the largest diamond rough ever found The Cullinan Diamond. The original weight of the Cullinan rough was 3106 carats and
yielded nine significant stones, 96 smaller stones and some extra 'bits and pieces'. The nine
significant stones were given the names Cullinan I through IX and reside with the British
Royal Family and Crown Jewels. The Cullinan I (530.2 carats), also known as the Star of
Africa, is mounted in the Royal Scepter and the Cullinan II (317.40 carats) is mounted in the
Imperial State Crown. The "smaller" Cullinan III and IV, 94 and 64 carats respectively, are set
together in a single brooch. We'll read about the Cullinan Diamonds in a later section.
Another famous diamond is the Hope Diamond. This stone is most remarkable because of its
deep blue colouration and lack of internal flaws something that rarely comes together in
such a great size! It weighs 45.52 carats, shows VS1 clarity, and its cut is described as a
Cushion Antique Brilliant. It was most likely mined in India from the Golconda region and
was first sold to King Louis XIV in 1668 by Jean-Baptiste Tavernier. It has changed hands a
number of times but currently sits in the Smithsonian Institution's National Gem Collection.
Because of its remarkable nature and long history, there are more than 5 books devoted to it

and many articles on the topic. Our textbook also includes details of this infamous 9 gram
stone.
Diamonds like the Hope, Koh-I-Noor and Cullinans are hard to value how exactly do you
put a price on the Queen Mother's centerpiece stone? And what scenario would unfold that
prompts the British Crown to sell such iconic pieces? To approximate the value of these
stones we could look at some of the most expensive stones ever sold, but even then, it is not a
true comparison. The historic blue Wittlesbach Diamond has a history stretching back to the
17th century and has been passed through many royal families. It weighs 35.56 carats and is
the current record holder for the most expensive diamond ever sold at auction (held in
December of 2008). Christie's is the proud auctioneer of this gem, and the reported total price
for this stone came to $24.3 million USD, which translates to ~$680,000 per carat. The
previous largest price for a diamond was a 100.10 carat stone (D colour, IF, pear shape) that
sold for $16.5 million USD in 1995. The highest price per carat for an unset stone is likely the
0.95 carat Hancock Red Diamond that sold for ~$925,000 USD per carat. If we use $680,000
USD per carat as a gauge for other infamous stones, then the Cullinan I has an estimated
minimum value of $360 million USD.

The Wittlesbach Diamond. Christie's Ltd. 2008

File: Top Ten Diamonds By Size

Module A. Diamonds and Due Diligence

Lesson 2 - Famous Gemstones and Jewellery
Top Ten Diamonds By Size

Diamonds more than 10 carats are exquisite, those over 50 carats are usually named and in the
possession of museums, royalty or very very wealthy people, and those larger than 100 carats
are usually not sold and find their way into recorded history. Smaller diamonds of intense
colour or with intriguing stories can be placed alongside other 'epic diamonds'.
The following is a list of the 10 largest polished diamonds:
Diamond Name

Carats, Rough

Carats, Cut

Origin

Golden Jubilee

755.5

545.67

Premier Mine, S.
Africa

Cullinan I

3106

530.2

Premier Mine, S.
Africa

Incomparable

890

407.48

Congo

Cullinan II

3106

317.40

Premier Mine, S.
Africa

Spirit of Grisogono 587

312.24

Congo (?)

Centenary

599

273.85

Premier Mine, S.
Africa

Jubilee

650.8

245.35

Jagersfontein Mine,
S. Africa

7th DeBeers
Diamond

428.50

234.65

DeBeers Mine, S.
Africa

The Red Cross

375

205.1

DeBeers Mine, S.
Africa

Millennium Star

777

203.4

Congo

File: Emeralds of Envy

Module A. Diamonds and Due Diligence

Lesson 2 - Famous Gemstones and Jewellery
Emeralds of Envy

Perhaps the first known use of emeralds as decorative stones was by the Pharaohs of Egypt.
Items dating back more than 1500 B.C. have been found, and the emeralds are usually
fashioned into beads that are then mounted in rings and pendants. Amulets carved from
emeralds have also been unearthed. The stones from the Egyptian deposits were certainly
emeralds, however, they did not have the quality that is seen from the deposits mined today
and are commonly called "Old World" emeralds. Emeralds of similar quality to those of Egypt
were mined in India's Rajasthan State and are often classified as Mogul Emeralds because
their extraction was commissioned during the reign of the Mughal Empire. Some of the better
quality and larger stones were carved with inscriptions and of those, the largest are often
named.
The most impressive of emeralds today originate almost exclusively from the mines of
Colombia and in antiquity are often called New World emeralds. Emeralds sourced from
Colombia are consistently more vivid, cleaner, and often larger than emeralds from anywhere
else in the world. Many beads, pieces of jewellery and ceremonial items containing emerald
have been found throughout the Andes and belonged to the Incans, but all likely originating
from Colombia. The Aztecs also valued emeralds and obtained their stones from Colombia as
well.
When the Spanish came to South America in the 16th century and returned to Europe with a
wealth of exquisite emeralds it did not take long for these stones to spread into other regions,
such as India. For instance, a spectacular large and clean emerald from Colombia was shipped
to India and subsequently carved into what was to become the famous Mogul Emerald. This
217 carat rectangular shaped emerald (measuring 5.2 by 4.0 cm) is inscribed with Islamic text
thought to be carved at the end of the 17th century. On the backside of the tablet is carved a
beautiful display of poppy flowers. In 2001 The Mogul Emerald was auctioned through
Christie's of London for $2.2 million USD.

The Mogul Emerald - Front (left) and back (right). Image from Christie's Fine Art
Auctions.

Yet another famous cut Colombian emerald is the Hooker Emerald (see our textbook by
Bonewitz et al. page 110) which weighs 75 carats and is set in a Tiffany-designed platinum
brooch. It is currently on display in the Smithsonian Institute's Museum of Natural History,
donated by Janet Hooker in 1977. Prior to her ownership the stone belonged to Sultan Abdul
Hamid II and subsequently Salomon Habib a famous French jewellery dealer.

The Hooker Emerald. The brooch is part of the Gem and Mineral Collection of the
Smithsonian National Museum of Natural History.
One of the largest uncut fine Colombian emeralds existing today is the Patricia Emerald,
weighing in at an impressive 632 carats, or 126 grams. The 6.35 cm long and 2.54 cm wide
stone (or rock?) has been housed in the American Museum of Natural History's collection of
precious minerals and gems since 1921.

The Patricia Emerald. Photo from the American Museum of Natural History.

File: Regal Rubies

Module A. Diamonds and Due Diligence

Lesson 2 - Famous Gemstones and Jewellery
Regal Rubies

Like emeralds from Colombia, rubies of the finest quality generally originate from Burma, or
what is known today mostly as Myanmar. Colour of the finest stones is often referred to as
Pigeon's Blood Red - a red to purple-red colour with medium-dark tone that is enhanced by a
red fluorescence. The famous "Mogok Ruby", also known as the Alan Caplan Ruby, weighs
15.97 carats and is perhaps one of the finest cut rubies. In April of 2005 Sotheby's auctioned
the stone for $3,630,000 - resulting in a per carat value of $227,301 - indeed an expensive
gem! It was sold to the Sultan of Brunei who apparently used it as an engagement ring - lucky
bride. In 2006, Christie's auctioned a similarly magnificent Burmese ruby weighing 8.62
carats and fetching $US 3,621,000 - resulting in a per carat value of over $400,00 per carat.

This Harry Winston, Inc. designed bracelet features 60 carats of the finest Burmese rubies set
alongside many marquise shaped diamonds. This colour of red is described as "Pigeon's Blood
Red". Photo from the Smithsonian National Museum of Natural History.

This unnamed ruby shows top quality colour and originates from Africa. Photo from the
Gemological Institute of America.
Two star rubies also make the history books. The Burmese DeLong Star Ruby weighs 100.32
carats and is on display at the American Museum of Natural History. Stolen in 1964, it was
returned for a reported $25,000 USD ransom far below the actual value of the stone but a
nice purse for the thief, Jack Murphy. The other famous star ruby is the Rosser Reeves Ruby
it sits in the Smithsonian National Museum of Natural History and weights 138.7 carats.

Rosser Reeves Star Ruby. Photo from the Smithsonian National Museum of Natural History.
But perhaps the most famous ruby is the Black Prince's Ruby that is set in the Imperial State
Crown just above the Cullinan II diamond (and in close proximity to the almost-as-famous
Stuart and St. Edward's Sapphires). Ironically, the Black Prince's Ruby is not a ruby at all, but
instead a red spinel. Its documented history starts in 1366 AD in Spain following which was is
a lengthy story filled with trials and tribulations. The story is well documented on Richard
Hughes' website. So although it is not a ruby at all its significant history makes that particular
spinel essentially priceless.

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Printable View of:Lesson 3 - Significant People and Groups

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File: Learning Objectives

Module A. Diamonds and Due Diligence

Lesson 3 - Significant People and Groups
Learning Objectives

By the end of this Lesson, learners will:

Identify the top producing countries for gold, PGMs and diamonds

Identify the prominent uses for gold, PGMs and diamonds

Describe the conventional diamond pipeline, from mine to market

Describe significant historical events of the late 20 th century and their

impact on the De Beers diamond monopoly

Describe the role that organizations such as GIA have on the jewellery
industry

File: Introduction

Module A. Diamonds and Due Diligence

Lesson 3 - Significant People and Groups
Introduction

When considering significant people and groups of the gem and precious metal industry the
whole spectrum from mine to market should be considered. Diamonds and gold play the
largest roles in the industry and consequently the key players of those worlds can be
considered the key players of the industry as a whole. We will also discuss the platinum group
metals, the second most important non-gem material used in jewellery.
On the market end of the spectrum, most consumers will shop at smaller independent
jewellery stores or retail chains but are familiar with a few of the more prominent luxury
retailers and auction houses. Backing this interface with consumers is an entire network of
association and organizations that provide support and education to the gem and jewellery
industry, playing a vital role in establishing stability in a market that, in reality, is not

necessary for everyday life.

Essential readings and topics for this lesson
None
Optional readings for this lesson
Websites given within the next pages.

File: Gold

Module A. Diamonds and Due Diligence

Lesson 3 - Significant People and Groups
Gold

South Africa currently produces 11% of the world's newly mined gold (Chemical Symbol: Au)
and has long been the world's largest producer of gold. However, in recent years China has
produced slightly more gold per year (12%). Australia, North and South America all produce
significant quantities as well, with Canada being the 8th largest producer in the world at 4% of
the world's output. Most of the gold in Canada originates from hard rock mines in Ontario,
Quebec, and British Columbia. The total global amount of gold produced on a yearly basis for
the last five years averages ~2,500 tonnes. Jewellery production accounts for 83% of the
global consumption of gold with the remainder being made up primarily by electronics,
currencies and investments.
On a company basis, Barrick Gold of Canada is the largest non-Chinese producer of gold
amongst those that have publicly released their production data. It is responsible for
approximately 10% of the market share, generated from 27 active mines on 4 continents.
AngloGold Ashanti of South Africa (20 mines in 10 countries on 4 continents) and Newmont
Mining of the United States (mines in 9 countries on 5 continents) each produce 7% of the
world's new gold. These large companies can exert significant leverage across borders and
their combined large numbers of operations have inevitably led to questionable situations
(politically, socially, and environmentally) for each of them. "New Gold" is distinguished
from "Total Gold" in global production number because a significant amount of gold is
recycled or pulled from central stockpiles when demand is high.

Lode Gold Deposits of Canada with size of circles indicating how much gold is present at
each location. Figure by the Geological Survey of Canada.

Major metal deposits of the world. Figure by the Geological Survey of Canada.

Gold mines operated by AngloGold Ashanti.

File: Platinum Group Metals (PGMs)

Module A. Diamonds and Due Diligence

Lesson 3 - Significant People and Groups
Platinum Group Metals (PGMs)

Platinum (Chemical Symbol: Pt) is commonly found with five other similar metals in nature:
palladium (Pd), rhodium (Rh), ruthenium (Ru), iridium (Ir) and osmium (Os). They are rarer
than gold, have a number of high-tech applications and less are produced annually. The price
of each metal fluctuates according to industrial applications, but in general Rh is the most
expensive, Pd is the least expensive and Pt has normally sat between the two. The graphs at
the end of this page show plots of historical prices for the platinum group elements.
The PGMs have a higher melting point than gold and exhibit very good durability and
strength. Use in jewellery accounts for approximately 30% of the global consumption of
platinum and palladium with the rest going primarily to autocatalysts (with 15% into
electronics). The market for platinum sales is a free market and prices of PGMs are largely
dictated by the global supply balanced by the demand in the autocatalyst and jewellery
markets. With a global supply of platinum group metals on the order of 475 tonnes (or ~17
million ounces), and much of that coming from the South African Bushveld Region, PGM
prices are subject to large swings especially if conflict slows or halts production in South
Africa.
The two main producers of PGMs are South Africa (79%) and Russia (12%), with significant
tonnages provided by the US (2%) and Canada (4%). The total annual output of Pt and Pd in
2005 from all mines was 216 and 214 tonnes, respectively, with about 23.5 tonnes of Rh
produced as well. In South Africa, the Bushveld Complex is the primary geologic structure
that hosts the mines that are producing the majority of the PGMs. Minor contributions come
from Palabora and the Witwatersrand Basin. Canada's production comes largely from the Lac
des Iles operation near Thunder Bay and as a secondary product from the Sudbury Complex's
nickel deposit in Sudbury, Ontario. The Stillwater Complex is the primary resource of the
United States. Anglo Platinum Group Ltd. is the largest producer of platinum with several
operations in South Africa and Canada.

Major nickel, copper, and Platinum Group Element deposits of the world, with size of circles
indicating the total contained amount of metal present. Figure by the Geological Survey of
Canada.

Major nickel, copper, and Platinum Group Element deposits of Canada, with size of circles
indicating the total contained amount of metal present. Figure by the Geological Survey of
Canada.

Historical and Current Commodity Prices for the Platinum Group Elements

*Note the more current data for Pt and Pd, while there are different data ranges
for the other PGEs
Data and Figures From The Bullion Desk

File: Diamonds

Module A. Diamonds and Due Diligence

Lesson 3 - Significant People and Groups
Diamonds

When one thinks of diamonds, the name De Beers immediately comes to mind, and with good
reason. De Beers Consolidated Mines Ltd. has essentially controlled the entire diamond
market since its inception in 1888 with the Kimberley Mine in South Africa up until the last
two decades. In addition to controlling the movement of diamonds from most mines through
the central Diamond Trading Company (DTC) and global network of Sightholders and
Diamond Bourses, De Beers has also conducted very successful marketing campaigns and
kept prices high for this tightly moderated commodity. As demand from consumers varied
through time, so has the limited release of diamonds to retailers even though supplies from
diamond mines has remained quite high at times.
The following is a typical, but generalized, view of the steps involved in bringing a
diamond to the market:
1. Geological prospecting and exploration

2. Mine development and mining

3. Sorting, valuing, and sighting of rough stones (DTC)
4. Cutting and polishing into finished diamonds
5. Jewellery manufacturing and distribution
6. Retail stores and sales
7. End consumer

Schematic showing the "Diamond Pipeline" from mine to market.

Once diamonds have been found (step 1) and are then pulled from the ground in the mining
step (2), they are sorted into gem, near-gem and non-gem parcels. In step 3, the Diamond
Trading Company coordinates delivery of raw goods from the mine to optimized parcels for
Sightholders. Within these parcels are also divisions based on size, colour, and clarity of the
rough diamonds. These packages are called 'sights' and their sales are tightly monitored; only
registered Sightholders are normally allowed to purchase sights.
It is difficult to value rough diamonds and there are not necessarily any fixed formulas to
determine this. Once the parcels have been bought, the rough diamonds are then faceted and
transformed into what we as consumers usually encounter - polished gemstones (step 4).
There are a number of 'cutting houses' around the world, but some of the historical centers are

in Antwerp, Mumbai, New York and Johannesburg. Lower cost cutting facilities have become
more common and are located in places such as India, Thailand, and China. Jewellery
manufacturing happens on both large and small scales. Some of the larger retail outlets have
their own manufacturing arms. However, most retail outlets are 'independents' and source
their finished products from manufacturers around the globe. Each manufacturer will typically
have a specific target clientele in which they design their jewellery for (e.g., middle class
consumers or high end luxury brands).
Exceptions to this chain of custody, however, have changed the way diamonds have moved
from mine to market. De Beers' strong control of the global diamond trade began to diminish
with the establishment of Australia's Argyle Mine in the 1980's. The Argyle Mine was not
owned by De Beers and although it ran some of its large production of diamonds through the
central Diamond Trading Company, much of their material bypassed this conventional port to
the consumer. Political changes and the deregulation of diamond distribution in Russia (due to
political collapse) and Angola (due to abundant small scale diamond production) in the early
1990's also delivered a large blow to the DeBeers control.
In the late 1990's the first diamond mine in Canada, Ekati (operated by BHP Billiton), started
to bring more high quality material to the market but also not through De Beers. In 2003, Rio
Tinto opened Canada's second diamond mine, Diavik, followed by Tahera Diamond Corp's
Jericho Project that started production in 2006. By the end of 2007 these three diamond mines
in Canada were already providing 12% of the global production of diamonds with a value of
~Can$1.7 billion.
The monopoly on the diamond market by De Beers is now effectively gone. However, the
tight control of diamonds on a global scale continues with the aid of the Kimberley Process.
The diamond market is now more competitive but because of the huge amount of money
invested in creating this industry, the flow of finished goods to the consumer is still tightly
controlled but just not from one individual company now.
Of all the diamonds being mined only about 20% actually end up being of good enough gem
quality to turn into polished goods. And of that 20% considerable loss is incurred when a
diamond is taken from its rough form and turned into a finished gemstone. The remaining
80% of the non-gem diamonds are used in industrial applications. These non-gem diamonds
are often called bort and exploited for their phenomenal physical properties. The most
common use for these diamonds is as abrasives.

Diamond mines of the world, and the old 'Archean Rocks' they typically occur within. Figure
by the Geological Survey of Canada.

Diamond mines (actively being mined or developed) and deposits (not actively being mined)
of Canada. Figure by the Geological Survey of Canada.

File: Retailer and Industry Organizations

Module A. Diamonds and Due Diligence

Lesson 3 - Significant People and Groups
Retailer and Industry Organizations

An important part of the diamond and jewellery industry is independent evaluations and
training of certified gemologists. An independent evaluation of diamonds is significant
because small differences in the grade of a diamond (e.g., between a D and F coloured stone)
can be substantial. If a retailer is selling a stone, they may wish to 'upsell' the quality of a
diamond, whereas the consumer would prefer to 'downsell' the diamond. An independent
evaluation of the stone in question eliminates these aspects and protects both the consumer
and the retailer. Various laboratories conduct evaluations, or certification, of a diamond but in

North America, the Gemological Institute of America (GIA) is the most reputable and most
stringent diamond grader. Other labs include the International Gemological Institute (IGI),
American Gem Society (AGS), and European Gemological Laboratories (EGL). All of the
reports generated by the above organizations will include documentation of the cut quality,
colour, clarity and carat weight of the investigated stone. Physical dimensions of the stone are
also recorded and enhancements to the diamond are also recorded along with any information
pertaining to the stone's origin.

Logos for the Gemological Institute of America and the International Gemological Institute.
Retailers and manufacturers have created organizations to form a collective voice for the
industry and provide functions and forums for collaboration and discussion of current topics.
The American Gem Trade Association (AGTA), Canadian Gemological Association (CGA),
Canadian Jewellers Association (CJA), and Jewelers Circular Keystone (JCK) are all groups
that provide benefits to their members. Many of these groups, along with the GIA and AGS
also offer educational programs where students may learn the techniques required for certified
gemological testing. For example, the GIA offers a Graduate Gemologist Diploma Program
that is highly respected in the gem and jewellery industry.

Logos for the American Gem Trade Association and the Jewelers Circular Keystone group.

File: Auction Houses and Luxury Brands

Module A. Diamonds and Due Diligence

Lesson 3 - Significant People and Groups
Auction Houses and Luxury Brands

When we discussed famous gemstones and jewellery in the previous Lesson it was apparent
that polished diamonds over 50 carats were highly unusual and did not follow the
conventional path of being sold from a retailer to a consumer. Your mid-range and high-end
jewellery stores will often carry stones up to 15 carats in their jewellery selection, but pieces
over that size are often in cases mostly for show rather than as regular pieces. So where does
one acquire fantastic stones or pieces of jewellery that don't reside in castles and in Royal
Vaults? Luxury and high end auction houses. The two most renowned auction houses are
Christie's and Sotheby's whose auction lots include magnificent gemstone and jewellery
pieces. These pieces are routed through these companies for sale; this is where record prices
are typically set for gems and jewellery.
Many luxury brands exist in today's market, however, many more have faded away in the
past. Only a few have survived long enough to become household names across North
America.
Tiffany & Co. , Harry Winston, Inc. and Van Cleef and Arpels are synonymous with exquisite
luxury jewels. Each has claims to fame and have played important roles in the jewellery
industry by adorning the wealthy and famous with magnificent jewels. Tiffany & Co. was
founded in New York in 1837 and is well associated with "The Tiffany Diamond", a 128.54
carat fancy yellow diamond.

Logos for Tiffany & Co. Ltd. and Harry Winston, Inc.
Harry Winston was an entrepreneur born in the late 19th century and started a very successful
jewellery company in the US. A work of note by Winston are the 12 Jonker gems. He also
dealt with creating jewellery for dozens of large diamonds and was involved in the buying and

selling of famous pieces (such as the Spanish Inquisition Necklace) throughout his career.
Harry Winston has also donated many stones to the Smithsonian Institution (e.g., the Hope
Diamond and the Oppenheimer Diamond) and helped create one of the most fantastic publicly
owned gemstone collections in the world. Van Cleef & Arpels was founded in 1896 in Paris,
France, and served much of the European elite. Examples of their work include the Princie
Pink Diamond Pendant and the Empress' Crown of the Iranian Crown Jewels.

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