4 June 2014

Mozambique: Mozambican Rubies to Be Auctioned in Singapore

Maputo — Mozambican rubies are to be auctioned in Singapore, according to Ian Harbottle, Chief Executive Office of the British company Greenfields, which is working in partnership with the Mozambican company Montepuez Ruby Mining (MRM).

Gemfields describes itself as the world's largest producer of coloured gemstones. It has specialized in Zambian emeralds and amethysts, and has now branched out into Mozambican rubies.

At a Maputo press conference on Tuesday introducing MRM, Harbottle said that the rubies will be auctioned some time in the next fortnight. He claimed that the auction would allow “transparency and fair prices”.

“We're going to hold an auction. We want a fair price and we want the money to come back to the company that produced the stones”, said Harbottle. “The company can pay its taxes, it can pay its works and it can make its investments”.

“When we sell the Mozambican rubies, we want every cent to return to Mozambique”, he declared.

The ruby mines in Montepuez, in the northern province of Cabo Delgado, would become one of Mozambique's largest taxpayers, Harbottle predicted.

“We want to help build Mozambique, guaranteeing that we comply with the law and that when we export, we do so legally”, he said. “We are obeying the law. We are paying taxes. Later there will be dividends. These dividends will go the shareholders who made the investment”.

Up until 2013, seven million karats of rubies had been mined in Montepuez, and Harbottle said that half of these stones would be sold at the Singapore auction.

Rubies vary greatly in price, depending on their quality (which is assessed on factors such as colour, size and cut). Medium quality rubies could cost between 100 and 400 US dollars per carat (a carat, the standard measure for precious stones, is equivalent to 200 milligrams). Top quality rubies fetch much higher prices. The world record price was set at a New York sale in 2005, when a Burmese ruby, of slightly more than eight carats, sold for 2.2 million dollars. Even if the Mozambican stones only fetch 100 dollars a carat, the Singapore auction could raise 350 million dollars.

Gemfields says it has invested about 30 million dollars in the Montepuez mines. The chairperson of the board of its partner, MRM, is Samora Machel Junior, son of Mozambique's first president, and its manager of corporate affairs is Raime Pachinuapa, son of Raimundo Pachinuapa, who was one of the senior guerrilla commanders in Mozambique's war for independence from Portuguese colonial rule.

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