Two Diamond Buys With Risky Appeal

Article Excerpt

Here are two of the most promising early stage diamond stocks. Both have speculative appeal, but they are buys only for highly aggressive investors. STORNOWAY DIAMOND CORP. $0.22 (Toronto symbol SWY; SI Rating: Start-up) (1-888-338-2200; www.sornowaydiamonds.com; Shares outstanding: 227.2 million; Market cap: $50.0 million) holds interests in over 14 diamond exploration properties in Canada and one in Botswana. TSE-listed Agnico-Eagle holds a 17.7% interest in the combined company. Global mining giant Rio Tinto Limited holds an 11.2% interest. Stornoway’s projects include a 50% interest in the Renard diamond project in Quebec, which has the potential to become Quebec’ s first diamond mine. Bulk sampling has produced promising carat-grade recoveries. The project is now in the pre-feasibility stage to define a total resource estimate. Renard is the company’s most advanced project, but close behind is the Aviat project on the Melville Peninsula in the eastern Arctic. This project is a joint venture between Stornoway (90%) and Hunter Exploration (10%). The partners have discovered 12…