Diamond Miner Sells Stones Online

Rob Bates -- JCK Online, 1/1/2001 2:00:00 AM

Australian mining company BHP wants to be the "Dell Computer" of the diamond industry.

In a surprise announcement that twists the traditional diamond pipeline into knots, the majority owner of the Ekati mine in Canada's Northwest Territories will sell stones directly to Australian consumers via a new Web site (www.aurias.com.)

"We wanted to take advantage of the strong recognition of the BHP brand in Australia," says spokesman Graham Nicholls. Eventually, the company may also market the site overseas, but Nicholls says the company wants to see how things go in Australia first.

The initial plan is to sell 1,300 diamonds-only 1% of the mine's production. All stones will be laser-inscribed, and the mine is considering branding each with a BHP logo. "Branding is becoming an increased feature in the industry," Nicholls says. "We see this as an opportunity for BHP to have a presence in e-commerce. In Australia, our name provides a lot of additional assurance to consumers." Nicholls says that if the site is successful, BHP might consider marketing other diamond brands to retailers.

The stones will be sold loose, without mountings. They will all be of top color and clarity and range in size from 25-pointers to 1.5-caraters. They'll be cut in Europe, and prices will range from $800 to $30,000. Despite cutting out some middlemen, Nicholls says prices will be within standard market levels. The company does boast, however, that the new model lets it increase diamond margins by 15%.

The name "Aurias" comes from a horse owned by one of the company's original shareholders.