St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1889-11-18
DELVING FOR DIAMONDS.
Present Condition Of Kimberly's Great
Industry.
CONSOLIDATING THE MINES.
One Mine Which Has Already Produced
# 100000 Pounds Worth Of
Diamonds.

Kimberley South Africa Letter in the New
York Sun.
The first annual meeting of the share
holders Of the DE Beers mines was held
here last week. This company was
formed about fifteen months ago to con-
solidate the diamond mining in
dustries of South Africa, and it has so
far succeeded that it has now the own
ership of the De Beers mine, which has
an area of about fifteen acres, with
about 600 claims. Out of this mine there
have been already eXcavated 3,250.000
cubic yards of diamondiferous ground,
producing diamonds to the value of
about SO, 100000, or about one and one
half tons weight of the precious stones,
between 1871 and 1885. Since then its
annual production has averaged about
E500,0C0.
This mine was originally worked by
Individual diggers. Then, as the depth
Increased and the cost of working be-
came too great for individuals. claims
were amalgamated and taken up by
companies, till at length the whole mine
came into the hands Of the De Beers
company, which has nominal capital
of about e2,0o0.00O. Early last year the
$40 shares of the company stood at $40,
making the capital then more than
eS.Oo0,0OO. At that time it was taken
over by the new company, the
De Beers Consolidated Mines. The next
. step of the Consolidated was to take
over the Kimberly mine. This mine,
although smaller than the DE Beers,
possessing only about $50 workable
claims, was and is much richer in its
production. and by the end of 1885 had
seoOped out 9,0O0,000 cubic yards of
stuff. half of which was damOndiferous.
The yield of diamonds up to 1885 eX-
ceeded 17,500,0 900 carats, valued at e20,-
100000. or about three and half tons
OF precious stones. The capital of the
Kimberly mine when amalgamated
stood nOminally at about E2,0OO.O 900,
and as the el0 shares were then selling
at ESQ the capital was nearly $4,000. 900.
Having these Two mines, the COnsoIi-
dated company had virtually the con-
troll of the diamond production. but
there were two other factors with which
it was important to deal. These were
the DutOits' Pan and the BultfOntem dia-
mond mines. These represented cap
ital of another G5,000,000. with an av-
erage production of nearly $4,000, 900 in
value. The companies holding these
mines have never been able to work
them probably, and it might have
seemed unnecessary to take them into
consideration at all in dealing with the
question of amalgamation But the
great fnanciers who have made it their
business to carry out their scheme
knew that they might fall into the hands
OF an opposition which would be able to
supply the market with precious stones
sufficient to prevent them having full
control of it. This was the great object,
to.check production so that the price of
diamonds might be regularly MAIN
tanned at profitable rate. To do this
they made a diamond pool, into which
the chief companies of other mines were
induced to enter, as De Beers had
quietly purchased shares sufficient OF
give them controlling power.
The effect of the pool was to raise the
price of diamonds from II to so shillings
per carat. at which they now stand.
The De Beers company has therefore
succeeded in buying up some of the
companies in the two mines | have lust
mentioned. 1t has entered into per-
petual lease with some of the others.
guaranteeing them interest OH their
canital varying from 4 to z per cent, a
better arrangement than the sharehoId-
erS could have ever hoped to get were
they to stand out for an ndependent
existence of their companies.
This. then, is the present state of af-
fairs. At the productive diamond mines
in Griqualand West are under the COM
plete control of one consolidated com
pany. This company has a nominal
capital of f3.900.0 QUO in e5 shares, which
are to-day standing at nearly e16. Dur
ing the year it has paid off amounts in
the shape of transfer and other ex-
penses which will only occur once
amounting to nearly quarter of mill
ion pounds, leaving profit Of G400.0
ont of which dividend of 10 per
CT MT has been declared for the last half
year. But this first year has been try
ing one for the company. 1t is only
within the last few months that dia-
monds have reached theIrpresent price.
The expenses will not occur again
which have been such a dram on the
revenue. Savings have been effected
and will be effected in the working
which will reduce the cost of pr0duc-
ton, and as the price of 25 or 80 shill-
ings per carat is to be maintained, it
will materially add to the profits of the
shareholders.
Such. for instance, is the accumuia-
ton OF blue ground on the f10orS-i. e.:
the diamOndiferOus ground taken from
the mines which has to be pulverized by
exposure to the atmosphere and by wat
eriDg. The W3tering process has been
expensive, but the new policy of check
ing production will leave the ground to
be pulverized by natures process alone
Il. e.: by long exposure to the atmos-
phere and rain, thus saving the cost of
water.
At present there are on the floors of
the two mines stock of blue ground
amounting to 7S6.000 loads. which rep
resent an asset of e1.375.O0O, as each
load averages IL carats of diamonds.
Altogether. then, this company is in
most fourishing condition. The de-
mand for diamonds has kept pace with
the production ever since the mines
were opened. That it will still keep
pace is shown by the fact that even at
the increased price all the diamonds
haue been cleared off, no stock remain
ing in hand. If things continue as they
are now there is nothing improbable in
the statement made by those who
have had large experience in
these mines that the company
will be able to pay dividend of be-
tween 50 and go per cent per annum,
and. if the demand for the diamonds in
creaSeS, even more. One fact shows
the remarkable skill of the finaDciers
who are manipulating this whole buSi-
nesS-viZ: that although the capital of
the mines was actually e22, 5O0.00O this
new company. having only capital of
G., 900. 900. will distribute larger scale
of dividends among the shareholders.
debentures having been raised for the
purchase of the other mines on which
only a small interest has to be paid.
The gold mines of South Africa.
which are now in the full swing of their
development, are gradually attracting
the notice of financial men and specu-
lators in all parts of Europe. With only
.,roaaartiac xrnrlri Tho Ii,