The Search for Diamonds

Patsey Barry sang “diamonds are forever” and it seems there is always intrigue surrounding the valuable gems. In Northern Colorado, an Australian company hopes to reap the benefits of a diamond belt found near the Colorado/Wyoming boarder, but many residents who live in the area hope their backyards will remain mining-free.

DiamonEx Limited, a junior diamond explorer which has an exploration program in Botswana, has requested permission to explore about a 23-acre area in the North Rabbit Creek Valley, off of County Road 82E, in northern Larimer County. The request has frazzled several families who live in the area, and have already formed a nonprofit group against the project.

With a uranium-mining propoal causing a dust up in Northern Colorado early last year, mining issues are already the talk of the region. Colorado is well-known for its history of gold mining, and its richness in natural gas and oil. Its neighbor to the north, Wyoming, has vast reserves of coal.

However, many people had no idea that the area, geologically, has the characteristics needed to produce diamonds—enough so to draw the interest of international diamond mining companies. In fact, the search for diamonds in the region goes back more than 30 years.

Neighbors Concerned

Diamonds may be forever, but Lori Drew and her husband Jay Stovall are fighting to keep mining away from their backyards forever. As soon as the couple found out about DiamonEx’s plans, they picked up the phone to notify as many property owners in the area that they could. Their next step was to form the nonprofit group, Leave our Valley Alone Forever.

About 62 cabins or houses and about 80 properties that do not have residential structures on them could be impacted by the exploration and the mining project itself—if it goes through.

“It seems like mining is coming back in Colorado,” Drew said. “We are seeing that with uranium. Who knows what else? Just because the minerals are here and most people who own the property don’t own the mineral rights, who knows when they are going to come knocking on your door? It’s a little alarming.”

But that is what literally happened, according to Stovall. He said he had a feeling something was going on last February when a guy knocked on his door after his car got stuck in a ditch. He didn’t think much of it at the time, but the guy was the exploration manager of DiamonEx.

Once the company submitted its plan to Larimer County in early August, word soon trickled out the residents. At this point, the company has completed the sketch-plan process. The company held a neighborhood meeting on Sept. 20, as stipulated by the permit process.

Several phone calls and emails to DiamonEx were not returned at press time.

Rob Helmick, a senior planner with Larimer County, said the next step will be for the company to submit an application for a public hearing for the exploration phase.

“The exploration phase has a one- to three-year time frame,” Helmick said. “If at the end of that, they have found what they wanted to find, they will have to come back and go through the whole public hearing process to build a mine.”

Helmick said the planning department has outlined a number of issues that DiamonEx will need to address such as water supply, air pollution, noise pollution, impact on the roads and how they will deal with electricity. If the company does meet all of the technical criteria, it will ultimately be up to the Larimer commissioners to approve the proposal.

“We don’t want to be Chicken Littles,” Stovall said. “We don’t want to be hysterical, but anyone that would have this come in wouldn’t be happy about it.”

Wayne Gentry, president of the Elk Meadows Homeowners association, which represents about 40 homeowners, said the major issue is that the area is not the empty and rural place that it was at one time. He said it used to be a mountainous property where a handful of families owned retreat homes, but now it has become a residential area where people live. He said the mine would impact property value.

“I think what is happening now is a lot of homeowners and associations in the area are trying to unite to try to save the way of life we currently have and hope we have a solid argument,” he said.

Kathy and Dale Gilliland have owned property in the area for more than 30 years. Kathy Gilliland said her family was there when the first mining operation opened decades ago. She said she and her husband had a bad experience then and are fearful the same things will happen. She recalled all the traffic on the beaten roads, all the noise and a mess left behind when the company closed the mine.

“They finally got it all cleaned up, and here we go again,” she said.

The Gillilands own an Alpaca business on their property and have concerns that the operation could also be impacted.

“The impact of having an industrial mining operation seems so out of context,” Kathy Gilliland said. “We are worried about the water levels and that the roads aren’t wide enough to accommodate traffic—to put any more stress on the area is unrealistic.”

Diamonds in the Region

Howard Coopersmith, 55, of Fort Collins remembers when one of his fellow-graduate students found the first diamond in the region back in 1975. Coopersmith probably knows the history of diamonds in Colorado better than anybody. After all, he has spent more than 30 years working in diamond exploration and diamond mining.

“It started as a geologic curiosity,” Coopersmith said.

He said he kind of fell into diamonds when he was studying geology at Colorado State University. He happened to be at the right place at the right time. Since then, he has worked all over the world, and now serves as a consultant for diamond companies, engineering companies and investment banks.

Coopersmith has long been involved in diamond exploration in Northern Colorado and Wyoming, but he is not involved in the DiamonEx project. Instead, he is sitting back as an observer.

“I think people are confused on what is involved and what their plans are,” he said. “They are taking their initial samples. They are a long way from making a mine. It generally takes five to 10 years from the first sampling to production.”

When the first diamond was discovered, Coopersmith, who was still in grad school, was immediately hired by an international mining company to do exploration work. In 1986, Coopersmith and the team he was working with at the time gained access at Kelsey Lake, which is located north of the area that DiamonEx wants to explore, and discovered the potential. During a 10-year period, testing and evaluation of bulk samples occurred. In 1996, the project moved into the trial mining or test production phase.

“Diamond mining is not like gold or uranium mining,” Coopersmith said. “It’s very clean. There are no chemicals or acid-producing waste or anything that harms the environment to any degree. But, even though it is fairly clean, a mine is a hole in the ground and you can’t make a mine without making a hole in the ground.”

Coopersmith acknowledges that diamond mining is an industrial operation and people do not move to the foothills hoping to have one in their backyards.

In the mid ’90s when the Kelsey Lake mine was in production, Coopersmith said they were not faced with the same issues that DiamonEx faces. The permit process was the same, but Kelsey Lake did not have many neighbors at that time.

Coopersmith remembers selling the first diamonds from Kelsey Lake.

“It was the first time people in the United States could buy diamonds in the United States and know where they came from,” he said.

The largest polished diamond and the fifth largest rough diamond in the United States came from that mine. From Coopersmith’s recollections, tens of thousands of carats had been produced at Kelsey Lake before the mine closed for good around 2002. From the tiniest of tiny to the two largest, which were an excess of 28 carats, Coopersmith saw the activity firsthand.

“Throughout the years, there were a lot of technical successes,” Coopersmith said. “We became good at finding kimberlites and diamonds, but a lot more goes into making a mine.”

Several companies came into the area over the years. In fact, Coopersmith said three separate companies explored in the same location that DiamonEx is interested in. Coopersmith himself was involved in exploration in that same area in 1978.

“I did test it in 1978 and it has been tested extensively twice since then,” he said. “Since then, everyone has walked away.”

A Numbers Game

Diamonds are formed at high pressure and temperature in the Earth’s mantle at a depth of at least 140 kilometers. Kimberlite is one of the only types of magma that is formed deep enough to incorporate diamonds and bring them to the surface.

“It really is quite a journey for a diamond to make it to the surface and be in an environment where it can be found and mined,” Coopersmith said. “It is a very unique and fortuitous set of events to make a diamond.”

The process only occurs in old, stable cores of continents. Kimberlite pipes are rare around the world. Though a number of smaller mines have come and gone, most of the diamond production comes from a small number of mines.

According to Coopersmith, there have been about 8,000 kimberlites found around the world with somewhere fewer than 1,000 of them having any diamonds at all and less than 100 that carry diamonds in any economic quantities.

“It’s really a numbers game,” he said.

Along the Colorado/Wyoming state line, there are about 40-45 kimberlites. Coopersmith said others have been found near Laramie. Others are scattered near Estes Park and Boulder. But Coopersmith is quick to point out that even if a kimberlite produces diamonds, it doesn’t mean a mine is feasible.

In total, Coopersmith estimates that there are about 25 to 30 major diamond companies in all the world’s history.

“At the end of the day, you have to be able to recover the diamonds for less money than they are worth, which is not simple,” Coopersmith said.