Red Feather newest site for diamond exploration

By Cherry Sokoloski
North Forty News

For people who live near Red Feather Lakes, the diamonds sparkling in the snow on a crisp winter morning are reason enough to revel in the place. But are there real diamonds as well in those granite hills?

One company hopes so and began prospecting for the gems last fall. Additional core samples will be taken late this summer.

DiamonEX Ltd., a mining company based in Brisbane, Australia, obtained a U.S. Forest Service permit last October to take samples at Lost Lake, located about 3 miles northeast of Red Feather Lakes. The company drilled three holes last fall and plans to drill three more this summer. The drill rig should arrive at Lost Lake in mid-August and will remain about two weeks.

The project will not interfere with recreation. People may still camp or fish at Lost Lake this summer, according to Sue Greenley, lands forester for the Canyon Lakes Ranger District of the Arapaho-Roosevelt National Forest.

The permit site is about five acres in size, but each drill hole is only 2.5 inches in diameter. "The disturbance is pretty minimal compared to a trenching project," Greenley said, referring to another method of mineral exploration.

DiamonEX is looking for kimberlite, a possible diamond-bearing mineral. Kendall Weeks, real estate operations manager for the company, said geologists have identified mostly granite so far in the exploration process, but they're still reviewing results from last year's samples.

DiamonEX's U.S. director of geology chose Lost Lake as a good site for prospecting. He was formerly employed by the Wyoming Geological Survey and has been doing field research along the Wyoming/Colorado state line for the past 20 years.

"He felt there was a high possibility of finding kimberlite in the dried-up lake beds," Weeks said.

Greenley said DiamonEX submitted a proposed plan of operations last July. The Forest Service conducted a basic environmental analysis, gathering opinions from wildlife biologists, hydrologists, soil scientists and other specialists. Since no significant issues were found, the project qualified for a short approval process.

When a drilling operation will continue for one year or less, Greenley explained, the Forest Service can issue a decision memo with no public hearings. District Ranger Ellen Hodges issued such a memo for the DiamonEX project on Oct. 10, 2007.

No road building was required for the prospecting operation, Greenley noted. Also, she said, DiamonEX has a reputation for doing a good job with reclamation.

If DiamonEX should find good-quality diamonds in the Red Feather area, the company would have to apply for claims and permits through the Forest Service and the Bureau of Land Management. At that time, a more detailed environmental analysis would be required.

A diamond mining operation looks much like a gravel pit, Weeks said. The process uses a high-tech DMS (dense medium separation) module that processes the final materials. At the end of the processing cycle, an X-ray machine/sorter separates the diamonds and places them in a secure container.

The range in value for diamonds is "extreme," Weeks said, running from almost nothing to thousands of dollars per carat. Diamond prices have been increasing 4 to 6 percent per year, he said.

Other diamonds found

The Lost Lake site is not the first in northern Colorado to be explored for diamonds. In recent years, the biggest operation was the Kelsey Lake Mine, near the Colorado/Wyoming border west of U.S. Highway 287. That site was mined from 1996 to 1998. In 1996, the mining company found a 28.3-carat yellow diamond at Kelsey Lake. Other large stones discovered there measured 28.2 and 16.3 carats. Sixty-five percent of the diamonds mined at Kelsey Lake were of gem quality, Hodges said.