Emeralds

Emeralds have been prized and cherished by kings and princes since they were first found in Egypt more than 5 000 thousand years ago. Together with ruby and sapphire they make up the classic trio of precious gems.

Emeralds are the precious form of beryllium-aluminium-silicate that has been infused with traces of chromium or vanadium, which gives them their rich green colour.

The Market

The conventional market reputedly takes up to US900 Million of rough emerald production per year. There are no reliable current statistics available to verify this figure, but in 2001 the Jaipur coloured gemstone industry, of which emeralds were an important component, amounted to some US$1Billion.

However, significantly, the jewellery market has undergone a radical change in the last 15-20 years. We live in a day and age dominated by retail chains, all-in-one super stores, catalogue marketing, and more recently TV shopping channels. This shift in the business model and environment has resulted in a massive growth in demand for colour stones, in volume. The emphasis now is on getting uniform colour, consistent supply in huge volumes, price point friendly pricing, as well as the constant need to introduce new colours and products in order to satisfy the huge appetite of the consumer market.

This trend goes against the nature of precious colour stones which come from the earth and are valuable because they are rare. Their rarity is derived from the fact that they are formed under unique geological conditions, as each crystal has been subjected to a variety of temperature, pressure and varying mineral influences. Gemstones therefore are not found in uniform colour and clarity. This is precisely what makes fine quality gems precious. This uniqueness is in striking contrast to the more abundant semi-precious stones such as amethyst and citrine, and topaz, all of which, because of their abundance, can be selected for uniformity of colour and clarity. Diamonds too, are found in abundance, and are graded by colour and clarity, but become precious because of market control.

In order to satisfy the huge volume of demand, gemstone suppliers have resorted to treatment and enhancement. One of the issues this has raised is that this has been done without informing the trade, with the consumer remaining ignorant of the difference between a natural and a treated stone. There is every reason to believe that today as much as 98% of rubies, sapphires and emeralds, have been subjected to some form of treatment. One source has stated that 99% of emeralds today are no more than pieces of “shattered green beryl glued together by different varieties of resin”.

The redefinition of the market has meant that some of the old established gemstone processors have seen the opportunities offered by selling direct to retail chains and from direct television marketing. This has given them greater control of their business by being closer to the customer, and is delivering better margins, more efficient inventory management, and vastly improved cash-flows.

The supply of rough material has seen changes in recent years, and months. Currently the most important jewellery retail markets (USA and EU), have notified their intention to impose sanctions on Burmese gemstones, the export value of which is in the region of US$290Million per annum. Falling Columbian emerald production is expect to further impact on the processing centres, which are fairly inelastic in their ability to reduce production capacity. Interestingly, while the old production centres are in a state of flux, China has become an important gemstone processor, with massive capacity to process vast quantities of semi-precious gemstones.

Tashkurgan Emeralds™ (Expert Report by Dr. Larry Snee)

"Emeralds were recently discovered in western China and represent only the second discovery of emeralds in bedrock in the world over the past 40 years. These new deposits were discovered in the year 2000 about 3km east of the Tashkurgan River near Dabadar, XinJiang Province. Local villagers have conducted artisan-style mining of the emeralds since discovery. The provincial government conducted a pre-leasing survey in 2002 before granting several mining concessions along a north-northwest-trending16km-longbelt. At least two mining operations are currently using heavy equipment to explore for and extract emeralds. However, the amount of emerald production up to the present is unknown, and except for hearsay reports nothing authoritative is known about their quality, composition, distribution, or geologic setting.

This part of XinJiang Province is located within the intersection of some of the world’s largest mountain ranges, the Pamirs, Kun Lun, and Karakorum. Nearby mountains rise over 5 000m, and a few are nearly 8 000m high. The valleys contain abundant recent sedimentary deposits indicative of active tectonics. This area is a complex geologic zone that has been affected by numerous geologic processes from the late Paleozoic extending up to the present day. The rocks within the emerald-rich area range in geologic age from late Paleozoic to Mesozoic. The emerald-bearing zone occurs along a major northnorthwest- trending relatively young regional fault zone that is possibly an extension of the Karakorum Fault, which extends northward from a major Himalayan suture zone. Host rocks include ultrabasic rocks, slates, and phyllites. Recent alluvial and colluvial sediments cover the western side of the emerald-rich zone, which suggests the possibility that emerald resources can be buried beneath these sediments.

The emeralds, themselves, are found in iron-carbonate (siderite)-rich veins that crosscut the ultrabasic rocks and slates within or near the fault zone. In some areas these veins are closely spaced and exhibit various orientations from vertical to nearly horizontal, all discordantly crosscutting the host rocks. During our visit, emeralds were found in situ in siderite-rich veins in the field. Emeralds recovered by the miners range in colour from pale green to dark green. Similar quality emeralds were observed within veins during our visit.

Current mining methods include artisan-type small-scale operations generally conducted by local villagers, as well as at least two mining operations that use heavy equipment in a haphazard non-conventional manner to excavate prospective deposits. The small-scale operations are focused on following the trends of siderite-bearing veinlets until emeralds are located and extracted. The heavy equipment operations are employed in areas of high potential defined by intensity of veining and alteration. These mining activities are causing serious damage not only to the environment, but also to potentially significant gems of the area.

For this report, Dr. Lawrence W. Snee, Ph.D., of Global Gems and Geology, LLC, conducted a preliminary field investigation of these deposits in September 2006. Dr. Snee accompanied Mr. Tommy Wu of Shire Trading, Limited to the area. Mr. Wu is assessing the quality of the emeralds, extent of the deposits, and conditions of current mining operations to determine if this new emerald find could be of interest to potential investors. During our trip we visited the deposits, recently extracted emeralds were examined, and a range of samples was collected. Current investors were interviewed and several artisan miners were questioned. We also visited one of the major mine managers and met with several provincial officials. The collected samples were shipped to the United States and examined in the laboratory. Selected specimens were distributed to various investigators for analysis. Dr. Snee visited the University of Arizona soon after his return to the US to meet with Dr. Robert Downs, a mineralogist in the Geosciences Department for a preliminary Raman Spectrographic analysis of a 15-cm long specimen obtained by Mr. Wu from the area. Dr. Downs’ analysis confirms that the specimen is green beryl, likely emerald. Additional green beryl samples that were given to Dr. Downs have been analyzed and show chromium contents characteristic of emerald. In addition, several other investigators are conducting microprobe, petrographic, isotopic, and fluid inclusion analyses to more clearly characterize the emeralds and their conditions of formation."