CRATER OF DIAMONDS -- FINDERS KEEPERS

Hopeful Visitors With Freshly Rented GearThe father and son pictured right carrying the sieve and army surplus entrenching tools are visitors to Crater of Diamonds State Park near Murfreesboro. This field has produced diamonds for about a century, and you're allowed to keep any gemstones you find. In addition to diamonds, this dirt is known to yield agate, garnet and amethyst, among others

Of course, you don't care about the history or the geology of the place. You want to know if you can find enough diamonds so you can tell your boss exactly what you think of him. What you want to know is your realistic chance of finding a gem quality diamond as big as your head in a casual afternoon of sifting through dirt. The honest answer is I don't know, but maybe I can gather some figures that will give you some realistic idea. These pictures were taken early on a Sunday afternoon in July, at the height of the tourist season. There were maybe fifty people digging. The park employee who took my entrance fee and stamped my forearm told me that two diamonds had been found that day, one about a quarter carat and one about a third.

You might also want to take into account that about half of the visitors are kids, and in a four hour visit they'll actually look for diamonds for about thirty minutes. Then in most groups there are some members who are enthusiastic about looking for diamonds and some members who are just indulging their boyfriends, who think this might be a cheap way to get that engagement ring. So just ballpark the numbers and figure that of every hundred visitors maybe twenty spend much energy actually looking for diamonds. Recent figures suggest that the field turns up an average of two diamonds a day, so guess your odds of finding a diamond at one in ten given that you are one of the visitors really looking.

I've visited the park about a half dozen times in my life and spent probably a total of twelve hours searching in earnest and I've never found one. Or maybe I have and just didn't recognize it. Many of the Arkansas diamonds I've seen on display just look like rocks to me. Like little yellow-brown gravel.

Park Employee Demonstrates Sieve Technique  to VisitorsThe park interpreters will teach you how to convert a bucket of dirt into a pile of gravel and how to examine the gravel for the telltale greasy glint that distinguishes a diamond from the rest of the gravel. That's what's going on in the picture on the left.

A sign at the entrance to the park declares this to be the eighth largest diamond reserve in the world and that 471 were found in 1999, 506 in 1998. That's not the whole story on the diamonds, though. That only takes into account diamonds that have been identified by park personnel. There is another class of diamond hunter, local and regular, who doesn't report what he finds. I've met a few of them and they don't say squat about squat and they don't mix with the tourists and they're not going to tell you who their customers are and the answer to the obvious question is always, "Haven't found any today. Should have been here yesterday." It's a tight little club, but I've heard that this is typical of diamond trading on any scale.

You can recognize the regulars by their neoprene gloves and boots. They're the ones digging out a four foot hole. What little I've been able to get out of them is that some of these guys collect for their own enjoyment. There are also local people who collect exclusively Arkansas diamonds. They along with local rock shops and souvenir shops represent the entire market for these stones. Most of the Arkansas diamonds you find in souvenir shops are a little bigger than a pinhead and can be had for ten to fifty dollars.

On the other hand, this field has produced some whoppers. The Uncle Sam, found in 1924 was 40.23 carats. It was cut down to just under 20 by Peikin of Fifth Avenue, New York. There's a replica of the cut Uncle Sam in the park museum. It's about the size of a double chiclet. The biggest Arkansas diamond I've personally seen is a canary yellow wafer about the size of a shirt button.

Digging for Daimonds

I looked up all the diamond finds reported in the Gazette over the first few years that the Crater of Diamonds operated as a state park. You'll notice that after a couple of years, diamonds smaller than three carats don't make the paper. Again bear in mind that frequent visitors who have learned to identify diamonds themselves will not always report their findings to the park staff. The valuations and comments are those of park geologists unless otherwise noted.

Note further that from 14 March 1972 to 11 May 1975 529 diamonds were identified by park personnel, of which 17 weighed over 2 carats. Within that time frame, eight diamonds over 2 carats were reported in the Gazette. So assume there were about twice as many big diamonds reported as you see listed here.

In the back of Howard Millar's Book, It Was Finders-Keepers at America's Only Diamond Mine, there are over twenty pages of names of people who found diamonds while Millar operated the crater as a private attraction. I'll leave that for you to look up.

DATE SIZE COLOR HOMETOWN OF FINDER QUOTES OR COMMENTS
7/73 2.57 Silver White Arlington, TX Est. $2K-$2.7K
7/73 2.12 Brown Des Arc, AR Appraised in NYC @ $12K+
9/73 2.00 Silver Cape Tulsa, OK "Prettiest diamond I've seen."
10/73 3.91 Silver Cape Osage, OK $10k
5/74 2.00 Light Yellow Des Arc, AR $2k-$3k
7/74 ? Light Brown Fort Worth, TX "He was kind of excited about finding that diamond and he took off before we got a chance to talk to him." Est. $4k-$5k
7/74 2.35 ? Huntsville, AR Park System carpenter found diamond after rainstorm while on the job.
4/75 4.32 White Rogers, AR ---
8/75 16.37 Clear White Amarillo, TX Found after rain. Size of wild pecan.
DATE SIZE COLOR HOMETOWN OF FINDER QUOTES OR COMMENTS
2/77 2.00 ? El Dorado, AR Found during El Dorado High School field trip. Finder turned down an offer of $300 for his find.
6/77 1.99 Silver Cape Nashville, AR Found in dirt dug from the bottom of a 6ft hole.
8/77 4.25 Canary Carthage, AR Found in a bucket of dirt he took home with him to sift. This was his 13th visit to the park.
4/78 5.00 Silver Cape Sulphur Springs, TX Est. $5k-$10k This frequent visitor has found several diamonds over 1 carat.
5/78 4.20 Pearly White Deer Park, WA Found after rainstorm on her first trip to the park.
8/78 8.61 Brown Hitchcock, OK Found on first trip to park.
6/79 5.08 ? Black Canyon City, AZ Found after brief period of heavy rainfall.
9/79 5.00 ? Springdale, AR Found on surface. This person's 55th visit to the park.
6/80 4.25 Canary Houston, TX "He had it in a sack with some other rocks and didn't know what he had until the park staff checked it." Est. $4k-$5k
10/80 5.15 White North Little Rock, AR State Game and Fish Biologist found diamond while on the job at park. Est. $7k-$8k
DATE SIZE COLOR HOMETOWN OF FINDER QUOTES OR COMMENTS
9/80 3.48 Brown Little Rock, AR ---
6/81 8.82 ? Shreveport, LA "Looks to be of excellent gem quality." Frequent visitors.
6/81 5.15 ? Shreveport, LA Yep, it's the same folks that got the 8.82 carat listed above.
11/81 6.07 White Murfreesboro, AR Refused offer of $7k. Local resident, frequent visitor.
4/83 3.20 White Swink, Ok Second trip to park. Est. $4k
9/83 4.71 Canary Murfreesboro, AR ---
10/83 6.20 White Topeka, KS Diamond found perched on surface next to paved walkway.
6/84 5.58 Brown Gretna, LA His fourth diamond.
4/86 2.28 Brown Rockton, IL Found after a rain. Family visits park every winter.
4/86 7.95 White Rockton, IL Brother of the guy who found the 2.28ct brown above.

Don't be discouraged by the sparsity of reports of large diamonds in the mid-to-late 1980's. During that time mining interests and environmentalists were involved in a controversy that the papers found more newsworthy than individual finds.

DATE SIZE COLOR HOMETOWN OF FINDER QUOTES OR COMMENTS
5/86 5.19 ? Ardmore, OK This guy visited 27 times in the previous year and found 22 diamonds.
3/87 2.58 White Murfreesboro, AR His 113th find.
8/88 3.76 Canary Branson, MO 724th Diamond identified this year to park personnel.
10/88 6.30 White Murfreesboro, AR One of the few found with classic square bipyramid shape.
5/89 3.75 White Clarksville, MO Slightly less than an inch across, finder said it looked like ice.
1/90 2.60 White Murfreesboro, AR -----
1/90 2.07 White Murfreesboro, AR Same guy found this diamond and the one above on same day.
6/90 2.59 Light Brown Morning Star, AR Found by a participant in a "Save the Crater" benefit.
7/91 3.39 ? Nashville, AR ----
11/91 6.30 Yellow Murfreesboro, AR Heart-shaped
7/94 5.25 Yellow Nashville, AR "Lemon Drop" octahedral shape found by Crater regular, not the result of beginner's luck.
8/95 4.35 Brown Germany ?
3/96 4.65 Brown ?, TX Second trip to park.
8/96 2.24 yellow ? ?
10/96 3.22 White Conway, AR Finder was eleven year old girl.
3/97 6.72 Brown Lockesburg, AR Biggest diamond reported since 1991. Color of strong iced tea.
4/98 7.28 Pale Yellow ?, LA Mother and Daughter on vacation found 5th largest diamond since crater became a park.

FREQUENTLY HELD MISCONCEPTION #1 -- THE MINE IS SALTED, NOT NATURALLY OCCURRING

One question that comes up is that of salting. Skeptical tourists raise the possibility that handfulls of cheap diamonds are scattered for guests to find just to keep the attraction attractive. The value of the reported diamonds is greater than the profit generated by the park. Add in the value of the unreported diamonds and any accusations of salting start to look pretty ridiculous.

However, in compiling the table above I think I've noticed a little puffery. It seems to me the Crater likes to make the papers a couple of times a year, and if September rolls around without two pressworthy finds by tourists, one of the local regulars will report a large diamond. There are about a half-dozen prospectors hunting 200+ days a year and several more working 100+ days a year. Surely this bunch comes up with a big diamond every month or two, and they want the park to remain viable as a tourist attraction, so they might report one or two selected stones in their own self-interest.

It was long assumed that chrome diopside was a necessary companion mineral to gem quality diamonds in lamporite soils. The absence of chrome diopside supposedly meant industrial diamonds only. Chrome diopside was not found in Arkansas, therefore educated geologists were often suspicious when gem quality stones turned up. The discovery in Australia of a kimberlite pipe with characteristics similar to those of the Crater of Diamonds lent credibility to the park.

(Note: In reading about the Crater, you'll see the words kimberlite, peridotite and lamporite used to describe the mineral composition of the soil. Chemically they are similar, but subtly different. I'm told by the staff at the crater that lamporite more accurately describes the dirt there, while the geological structure of the volcanic pipe is still referred to as a kimberlite formation. I chose the background color of this web page in an attempt to approximate the color of the dirt.)

That didn't mean fake stones didn't turn up from time to time at the crater itself and on neighboring land from time to time. What prankster could resist buying a handful of CZ and spreading them around? The park staff is pretty good at spotting them, and I've only found one recent instance where a jeweler identified a manmade stone that was found in the crater. In March of 1991, Brinda Golden of Rusk, TX found a 4.33 carat fake which got past the interpreters. It was later caught by Bill Underwood, a Fayetteville jeweler.

In the same area over the course of a few days two more fake stones of the same type were found by visitors, but were identified as manmade fakes by the park staff. A week later Bill Underwood identified a 4.13 carat 000 grade stone found by "a Texas resident... two or three months ago." That sounded to me like a panicky attempt to reestablish the legitimacy of the crater, so I left it off the list.

FREQUENTLY HELD MISCONCEPTION #2 -- AFTER A CENTURY OF SURFACE COLLECTING THE TOP LAYER OF DIRT IS PLAYED OUT

Another thing I kept reading in my research was a recurring complaint that the mining as practiced at the park just turned the top three feet of soil over and over and that this layer was all played out. While this seems to make sense on the surface (yuk yuk), and the objection has been raised every ten years or so ever since the mine has been open to tourists, the facts just don't bear out the assertion. The number of finds is directly related to the number of visitors by a ratio that hasn't changed much in fifty years.

In fact, several reports by geologists (John T. Fuller, 1908; Arkansas Diamond Company, 1920-1922; The USGS in 1942-1944; and Glen Martin, 1948) allude to the fact that erosion of soft diamond bearing soils tends to concentrate diamonds near the surface, in the top 20-40 feet of soil. It is typical of diamond bearing soils that the surface layers have a higher concentration of larger stones than deeper deposits. Any farmer will tell you that stones will keep percolating up through a plowed field generation after generation.

FREQUENTLY HELD MISCONCEPTION #3 -- ARKANSAS HAS THE ONLY DIAMONDS IN NORTH AMERICA

Arkansas has the only diamond MINE in North America. Sand-sized diamonds of industrial quality have been found along the Colorado/Wyoming border and in Minnesota. Diamond bearing soils have also been discovered in Canada but as far as I've read, none of the other North American finds have been mined. Of course, I've also read that people involved in diamond exploration are very secretive, so just because we haven't heard about any other formations in North America that have lots of gem-quality diamonds doesn't mean they aren't there.

Now for some history, and prepare yourself. It's one of those surreal Arkansas generation-spanning Wild West soap operas.

FIRST DIAMONDS DISCOVERED

John Wesley Huddleston was a middle-aged father of a house full of girls, a local character, a gambler, illiterate, a hard man, shrewd and suspicious, tall and stoop-shouldered, strong as an ox and so handy with a .45 that he used to keep sharp by shooting wasps out of midair. There are variants of the story of his finding the first diamonds. The most frequently told story goes that he was working up the soil preparing a turnip field, but an account related by Millar holds that Huddleston himself told Millar he was putting out salt licks in an area where he let his hogs run loose when he spotted some shiny golden flecks in the green gumbo mud.

He had some experience panning for gold, so he took a panful of mud down to the heretofore appropriately named Poor Man's Branch to wash it. The golden flecks floated, so they weren't gold; but in the bottom of the pan Huddleston found two shiny pebbles, one yellow and one clear.

The man who sold him his grinding wheel guaranteed it to grind anything but diamonds, so Huddleston tested his shiny pebbles on it. The stones wore a groove in the wheel, so he showed them (He called them "deemints" says every article I read.) to a banker in Murfreesboro, who recommended a jeweler in Little Rock (Charles Stifft), who verified that they were diamonds, but recommended an appraiser at Tiffany's to fix a value on the stones.

A generation earlier many people had been swindled in a famous diamond mining fraud in Arizona, so Dr. H. S. Washington of The Smithsonian Institution and Dr. George F. Kunz, Vice President of Tiffany and Company, NYC, personally visited Huddleston's farm. This was no small feat in 1907. From Little Rock a commercial train ran as far as Prescott, where one could hop Prescott Northwest log train to Highland. You made the last ten miles to Murfreesboro as best you could. The lumber company could arrange a horse or wagon for a fee.

Washington and Kunz verified the claim upon being shown a gem quality diamond still in its original rock matrix.

Huddleston sold his worthless hog waller to Albert D. Cohn, son-in-law of George Stifft and a prominent Little Rock merchant. Cohn had offered him $12,000, but there were six members in Huddleston's family, and he figured $6,000 per would set them each up for life. Thus he demanded and got $36,000 in cash, and when I say cash I mean a stack of ten dollar bills (says Millar, another account says $20 bills). Not a bad deal considering he had bought the land only seven months previous for one thousand dollars and gave a mule in lieu of the hundred buck down payment. (Note: In the Henderson book there's a family portrait showing Huddleston, his wife, and five, not four, daughters.)

Huddleston was luckier than wise, though, and by the end of his life all of the money had evaporated in the heat of bad decisions, poor investments, and cruel fate. For example, his second wife was a youngish blonde carnival girl he met in Arkadelphia. He was infatuated with her and bought her lavish gifts like a brand new Model T Ford coupe. One day she drove him into town so he could get a couple of cigars. As he hopped down from the new car and started into the drug store she threw the car into gear, headed west and was never heard from again.

The discovery set off a rush of land speculation attended by the real estate scams, phony diamond strikes and fraudulent mining companies one grows to expect after reading a lot of Arkansas history. In this confusing whirlpool of claims and speculation, one professional geologist from St. Louis came down to the wilds of southern Arkansas, located the extent of the kimberlite pipe (78 acres). This guy's name was Austin Millar, and his family would make a living off this land for the next sixty years.

The Millard M. Mauney HomeThere were two plots of land across the main diamond-bearing formation. The Millard M. Mauney family owned forty acres. At left is a picture of the Mauney house as it stands today along the road between Murfreesboro and the Crater. It was built by Isaac White before Arkansas entered the union. The home was rebuilt by Walter J. Mauney in 1911, just after the diamond strike. The walls are painted with murals depicting, among other things, Huddleston finding the first diamond. An unfinished oak tree trunk stands as a central column from the ground to the ceiling of the first story. It's an eccentric little place, unfortunately not open for public tours. You can, however, peek in the first floor windows at the murals on the opposite walls.

A Prescott businessman named Horace Bemis entered into a partnership with Mauney. A disagreement over the payment of royalties led to a division of the property and Millar bought the Bemis holdings from the Bemis estate upon his passing. The Huddleston property was bought by a group of investors headed by Sam Reyburn, a Little Rock businessman who shortly thereafter obtained a position in New York with the family of companies controlled by J. P. Morgan, eventually rising to the position of Chairman of Associated Dry Goods.

In his book, Millar pegs Reyburn as the heavy in the stifling of the diamond industry in Arkansas. He flatly accuses Reyburn of being a stooge for DeBeers. Although he has no proof, he cites Reyburn's meteoric rise in the Morgan organization, J. P. Morgan being considered an early backer of the London diamond syndicate and its agents in this country. Reyburn also seems to show up in court every time Millar is being sued for something. Also, in those early days, Reyburn travelled occasionally to London, sometimes in the company of John Fuller, a DeBeers mining engineer.

I'm going to skip a lot of the banking and real-estate machinations that went on in the early days. They're very entertaining, but also very complex. Might make a good mini series some day along the lines of TV soap "Dallas."

The Huddleston farm almost found its way into the hands of Tom Cochran, Vice President of the J. P. Morgan company due to a past-due payment. When the investors learned through the grapevine that they were about to get screwed by their principal partner, they rushed to New York with suitcases full of cash to pay off the mortgage. Diamonds held by Cochran as collateral were gone, however. Cochran had sold them in a phony auction on the steps of the Hot Springs courthouse where the only bidder notified of the proceedings was a representative of Schenck & Van Haelen. In that packet of diamonds was the Uncle Sam, the largest diamond ever to be pulled out of the Arkansas dirt.

THE MILLAR MINING OPERATION

Site of Former Commercial Mining Operation -- The Amarillo Starlight was found about ten feet to the right of that trash barrel.Millar spent a couple of years exploring his claim, and in 1914 sent for his son Howard to help him begin small-scale commercial mining. By 1919 they had spent $350,000 building equipment to remove diamonds on a large scale. A few days after starting the large scale operation, the mine burned down in the absence of a night watchman who had been lured from his post by an out-of-town woman of easy virtue. The younger Millar said he knew who had sabotaged the mine and had gathered evidence against him, but a close friend told him that if he brought the evidence forward "there might be a killing," so the perpetrator was never brought to justice.

Sabotage and rampant pilfering by employees prevented the Millars from making more than a living. The last large scale attempt to mine the Crater of Diamonds commercially took place during WWII, when foreign supplies of industrial diamonds were threatened. The Reyburn investors, having rescued their investment from Tom Cochran, eventually sold it to Charles Wilkinson, a machine tool tycoon from Indiana. At the beginning of the second world war, Wilkinson sent representatives to meet with President Roosevelt to convince him to develop our diamond resources because the coming crisis might endanger our supply from South Africa. Roosevelt issued a priority for over a half-million bucks to buy mining machinery, but mysteriously the decision was rescinded a few days later.

In 1944 the Bureau of Mines drilled nearly fifty holes and shipped the dirt away for evaluation. Years later they reported that they had found 32 diamonds totalling 8.4 carats, a much lower figure than Millar expected based on his own experiences. Millar and others published highly critical accounts of the sorting methods used by the Bureau of Mines in this test.

PRIVATELY OPERATED TOURIST ATTRACTIONS

The first one to let the public prospect for a fee was Millard Mauney back in the early days. For fifty cents the visitor bought not only the right to prospect, but also a dish of ice cream. These forays were occasional, though, not an ongoing operation.

After the war, during the Laney administration, the state came up with the idea of acquiring the land and operating it as a tourist attraction. Millar contacted the state and let them know just how expensive a taking would be, and that the taxpayers couldn't possibly bear the burden. Shortly after that, two men from Murfreesboro leased Millar's property and set up an attraction much like the one you see today called the Diamond Preserve. Their financial backer was none other than Ethel Wilkinson, the owner of the property next door to Millar's.

There was a short-lived partnership in which the Wilkinson and Millar property were to be consolidated into an attraction called Crater of Diamonds, a name suggested by Mrs. Wilkinson's lawyer, Joe Noel. Mrs. Wilkinson failed to come up with all of her share of the investment capital and the partnership was dissolved.

In 1952 the Millar family opened the Crater of Diamonds attraction on their 36 acres of the kimberlite pipe. Right next door in 1962 the "Arkansas Diamond Mine," a practically identical attraction owned by Ethel Wilkinson of Logansport, Indiana, opened. The Arkansas Diamond Mine was run by two former employees from Millar's Crater of Diamonds. Both attractions offered much the same deal the Crater of Diamonds offers now. The tourist pays a fee and gets to keep any diamond he finds. The only difference was that you didn't get to keep the diamond if it was over 5 carats. The Millars would sell it and give you 75% of the sale price. Not a bad deal, but they still had to rely on the honesty of their customers.

And things went like that, a buck fifty a head and go dig for diamonds, until 1969 when General Earth Minerals bought both parcels of land. Right away there was trouble. They agreed to operate the mine as a tourist attraction while exploratory drilling was under way. They boosted admission from $1.50 to $4.00 and discontinued the monthly plowing that kept the dirt loose for the amateur prospectors. Area tourism fell off and locals who made their living mining the miners were upset with G.E.M.

CRATER OF DIAMONDS STATE PARK

In 1970 test drillings failed to penetrate a layer of blue granite 33 feet down. The Delight Drilling Company, an exploratory company set up by General Earth Minerals, ordered a special carbide drill to penetrate the granite layer. So G.E.M. was beset by community ill will, lawsuits initiated by third parties like DeBeers and Henry Ford, and by the implied difficulties of digging past a shallow layer of blue granite the extent of which was unknown. Finally, G.E.M. decided that the Crater of Diamonds wasn't worth the trouble. In 1971 the State Park and Tourism Commission voted to buy the mine and 800 surrounding acres if they could get Washington to come up with half the $750,000 price tag. The U.S. Bureau of Outdoor Recreation never offered to help, but Parks and Tourism bought the land anyway.

Later, though, the Department of Interior contributed $723,000 to the park from the Federal Land and Water Conservation fund to develop the park on condition of its perpetual use for recreation. So when you dig for diamonds, remember the Park has two lines of descent. One goes Mauney, Bemis, Millar, GEM, Arkansas. The other goes Huddleston, Reyburn (et al), Wilkinson, GEM, Arkansas. And that is how the eighth largest diamond reserve in the world became a State Park.

ANACONDA AND SUNSHINE

Things went fine for about ten years. Then in 1981 Anaconda dropped a proposal on the state's doorstep, offering $6k per acre up front plus $6k per acre per year in order to sink some exploratory shafts in the park. Once mining started in earnest, the state would get 15% of the net. It seems that over the past year they'd been acquiring leases on land all over the county and had been mapping topography and magnetic fields. They'd found the area to be similar to other diamond producing areas and felt it was time to do some digging in the park itself.

What they were offering was a lot of money to an economically depressed region, and if you want to see Arkies fight, just drop a bundle of money on the floor. Anaconda made its offer to the Commerce Department, but the Parks Commission was reluctant to sign away the only state park that consistently turned a profit so that some other department could make a lot of money. Other mining companies fomented suspicion by whispering that Anaconda was lowballing and by the way they found it awefully suspicious that there was no open bidding for mineral rights in the park.

There were three factions in conflict: Mining, Tourism and Environmentalists. The tourism faction was the power in the balance. The victory was likely to go to the miners if they could credibly promise that we could sell our diamonds and keep our tourist attraction. Anaconda, to their credit, told it to us straight, that we couldn't eat our cake and have it, too. Their best offer would be to let tourists sift through the tailings from their mine.

And that was really the last of the Anaconda proposal. Now that word had gotten out that Crater of Diamonds was up for grabs the circus came to town and Anaconda rightly sensed that there was likely to be an awful mess. They pulled out and sold their mineral leases to one of the new contenders, Hanvey-Boulle Ltd., connected to a western company called Sunshine Mining. They and over a dozen other mining concerns showed up and vied to hire the lawyers, consultants and P.R. firms with the best political connections. Governor Clinton appointed a "task force" to consider mining proposals.

Meanwhile, in the so-called real world, the Earth's two largest producers of diamonds, the Soviet Union and South Africa were experiencing a period of social upheaval and political transition.

The Governor's Task Force on Diamond Mining decided that laws governing the mining of coal and gravel were insufficient to cover the mining of diamonds, so State Senator Neely Cassady (Murfreesboro is in his district.) sponsored Senate bill 642 (passed as Act 793 of 1987, see below), which provided that Parks and Recreation was empowered to execute mineral leases on diamonds and would split the proceeds with the state treasury. Senater Nick Wilson amended the bill such that all the money would go to the state treasury. You can imagine how the Parks people took to that.

The new customized law said that Parks and Tourism, without the approval of any other state agency, had the authority to issue a lease and that there need be no competitive bids accepted. Conspicuously absent was a requirement for the filing of an environmental impact statement. So the new law cut red tape, eliminated competition and absolved the lessee of environmental responsibility.

The true extent of the kimberlite pipe was unknown, but that didn't keep interested parties from pulling statistics right out of their butts. Mining supporters said in one article that a commercial mine would create 189 new jobs, $96,000 in local taxes, $36,400 in state taxes and $8,000,000 "travel dollars." Opponents said the mine could be exhausted in five years and Arkansas would be left with a polluted lake 600 feet deep and 2400 feet across. Then, no jobs and no more tourist attraction. The local branch of the Sierra club objected to setting a legal precedent allowing the commercial exploitation of a state park.

There was a legal fly in the ointment concerning the $723,000 that the park got from the U. S. Department of the Interior to develop the land for recreational purposes. Now that Uncle Sam had his finger in the pie, permission to remand the property to private use would require 1) Permission from the Secretary of the Interior and 2) substitution of equivalent alternate land. J.D. "Bud" Schamberger said, "I'd like to know what other diamond mine we're going to swap for that one." If Interior disapproved of mining the park, all offers would be moot. With that in mind, the Blue Ribbon, Gold Star, Super Duper Turbocharged Governor's Brain Trust Diamond Exploration Committee Task Force voted almost unanimously (there was one dissenting) to ask the Secretary of Interior for approval.

Not long thereafter, word came down from the National Parks Service that diamond mining would not be permitted because the feds had paid to develop a recreational facility and by the agreement the park had to stay a recreational facility. Offering one of our lovely swamps, excuse me, wetlands as a substitute was no good because the recreation in the park centered on the diamond field. Nothing but another diamond mine would do. (Interior later indicated that wetlands could be substituted for the crater, but because of the "equal value" provision, there might not be enough swamp in Arkansas to equal the value of the eighth richest diamond reserve on earth.) And by the way, exploratory drilling was also forbidden because the only intention of such drilling was as preparation for mining. So forget it.

Three weeks later, Parks and Tourism got a call from Interior saying they were reconsidering the prohibition pending reciept of additional data. So Interior had rescinded its previous decision and the game was on. You know, some games you only win if you don't play.

The battle lines were drawn again along much the same lines, Miners and Money Men against the Environmentalists with Tourism Interests in the balance. The environmental interests were the Arkansas Wildlife Federation, the Sierra Club and some other concerned citizens huddled under the umbrella group, Friends of the Crater of Diamonds State Park. Their legal mouthpiece was James Stanley, husband of Audrey Burtrum-Stanley, whom you know from the Sesquicentennial Sundial and the Live Oak Tree.

The state solicited proposals for minimally invasive exploratory drilling and four were submitted. It was decided that since the state or the feds could pull the plug on the project at any given moment and that successful testing was no guarantee of permission to mine commercially, that all four would share the cost of testing. Testing would be coordinated by a "Director of Testing" mutually agreeable to all the mining companies involved. Phase I would cost about $350,000 and would consist of about 40 holes, each just under 2 inches across and likely 600 feet deep to ascertain the extent and shape of the volcanic pipe.

If Phase I was successful, Phase II would consist of a series of larger holes, the earth from which diamonds would be extracted in order to determine the number of carats per 100 tons.

So here were the rules the state imposed on the mining companies. A consortium of four mining companies was selected to fund Phase I. After the completion of Phase I, the partners would decide if they wanted to fund Phase II, which would be the removal and examination of some 10,000 tons of dirt. Then IF commercial mining were approved by the state AND the feds, all companies still in the consortium would be allowed to bid on leases within the park. The game was cancelled if membership in the consortium dropped below two. Whoever won the commercial mining contract would reimburse the remaining losers for their share of testing expenses. You bail out, you lose your ante. You stick tight and lose, you get your investment back. You stick tight and some government pulls the plug, all partners get a big write-off at tax time.

Four lucky participants were chosen.

1) Arkansas Diamond Development: This was a partnership between Exidiam Corp. of Dallas, Diamond Field Resources, Inc. (DFRI was a restructured Hanvey/Boulle, Ltd. - Boulle Group) and Rhombus, a holding Company for members of the Stephens family. Stephens, Inc. is the biggest investment banker in the state.

2) Capricorn Diamonds Party, Ltd. (West Perth, Australia).

3) Continental Diamonds (Little Rock, AR) partnered with Galactic Resources, Ltd. (Vancouver, BC) and Diamond Exploration, Inc. headed by Little Rock Businessman James Cairns, Jr.

4) Kennecott Exploration Co. (Salt Lake City, UT), a wholly owned subsidiary of RTZ (UK) the largest private mining company in the world.

Kennecott and Capricorn had the capital and the expertise. The contributions of A.D.D and Continental had more to do with enthusiasm.

By the end of this story, two of the four consortium partners will flee and two will be destroyed. One principal will go to jail. Millions of dollars will be spent and lost in lawsuits. One company will go bankrupt after causing the most expensive ecological disaster in American history. Nobody involved at this point will get any diamonds out of Arkansas, and regardless of all the millions about to be spent, the contents of the crater will still be a mystery beyond the turn of the millennium. Only two parties will be pleased with the way this episode plays out, and neither of them are (publicly) involved yet.

Shortly after Phase I started, the environmentalists filed suit with the District Court Judge asking the judge to call an immediate halt to drilling because miners had broken the agreement in the following ways. 1) They weren't muffling their machinery through a water-filled sump. 2) They did not have balloon tires on their rigs. 3) They were working outside fenced areas. 4) They had added extra shifts to work 6am to 10pm instead of 7am to 8pm, as agreed in the contract. 5)They were not lining the sumps with plastic. 6) They failed to keep cement on hand to handle the emergency, should an artesian aquifer be struck, and 7) They were pumping effluent into public areas of the park.

The miners said the allegations were bogus, claiming that 1) Their rig has two mufflers on it and they were installing a third. 2) Their rig was supported by skids which compact the earth even less than balloon tires. 3) ONE day a pickup truck got parked outside the fence. Give us a break. 4) The contract allows the miners to change the hours of operation if the Director of Drilling (the one they hired) say's it's okay. So there. I didn't find reference to their answers to the other allegations, but the long and short of it is that the Judge didn't issue the restraining order that the environmentalists wanted.

After four holes were drilled, John Morgan, Director of Testing speculated that the Crater could be the 5th largest reserve of diamonds in the world. Of course, after drilling only four holes, he was speculating pretty broadly. A legislative subcommittee voted to officially commend all who had a hand in arranging for the exploratory drilling at the crater, including Parks and Tourism, the mining interests, Governor Clinton and a host of others.

Finally, after a month of drilling, the District Court handed down a decision. Drilling must stop because it has no purpose other than to lead to commercial exploitation, which is prohibited by the agreement with the Department of Interior. There was nothing to suggest that exploratory drilling would do anything to enhance the park's recreational value. Interested parties had 60 days to appeal the decision.

So that's what happened. Later that same month Capricorn Mining of Australia and Kennecot Exploration of Salt Lake City argued before the 8th Circuit Court of Appeals that test drilling constituted a "temporary non-conforming use" of the State Park in much the same way as excavation for laying underground cable or sewage or plumbing for park facilities does, and therefore permission can be granted by the Department of Interior. The Court ruled 2-1 to set aside the District Court's injunction.

Parks and Tourism says that if test drilling is allowed then it is now mandatory. The consortium is obligated to fulfill its contract to complete Phase I testing. Of course, every time operations stop and start, the consortium has to pay startup costs again, and the in-state consultants they are required to have on the payroll get paid whether there is drilling or not. So now this thirty day operation that started in 1987 has dragged out into 1992 and while they have enough cash left in their original account to pay the in-state consultants up through July 4, Parks and Tourism tells them they'll have to come up with another $74,071 to drill 52 more days to completed Phase I.

I have to wonder what was going on in the minds of the drillers. They've got a tailor-made law on the books that allows them to do anything they want with permission from only one state agency. They've spent $190,000, not to mention the money they spent in legal fees, consultants, public relations people, and who knows what else; and in five years they've managed to drill four holes.

Add to this the fact that either the state or the federal government could arbitrarily stop the project at any time. And any lawyer with scruples would surely advise his client that the chances of getting permission to mine the crater commercially are just about nil. And then Mr. Haney says to Mr. Douglas you've got to put up another $74,071 to complete the project. Somehow they're telling themselves this isn't quicksand.

Now I've had bad propositions pushed on me at short notice. We all have. But if I have five years to think things over I might suspect I'm being had and that's how the miners felt. There was lots of distrust on both sides by this time. The drillers accused the State of orchestrating delays to twist more money out of them. Nevertheless, they came up with the cash and the drilling time was extended.

There was a little small-time scandal mongering on the part of the Gazette. It turned out that the two sponsors of the 1987 diamond mining law had received campaign contributions from Arkansas Diamond Development, Inc. Wingfield got a total of $800 over the course of two campaigns. Chicken feed, really, and try to find a political campaign in the state that doesn't get SOMEthing from the Stephenses. Steve Stephens described the contributions as acts of the company's "good corporate citizenship."

The drilling companies moved their test site down an abandoned logging road (away from the protesters) to a location 1/4 mile west of the tourist prospecting area and discovered that just a few feet below the surface there was lamporite. They said that the pipe was much much larger than had been previously thought because a large section had been covered over by alluvium deposited by floodwaters of the Little Mo.

Of course the protesters followed them into the woods. Protest leader Richard Mason photographed and catalogued violations of their agreement, mainly damage to shrubs and the felling of trees along the old mining road. Wallace Mitchell, speaking for the consortium, said those trees were blown down in a windstorm, and besides we couldn't avoid knocking them over. "The guy that drove the bulldozer probably should have had a little more supervision than he had." Demonstrator David Johnson of Waldron burned a list of park rules in protest.

Attorney General Winston Bryant, running for reelection, brought a group of press people down from Little Rock to watch him tour the drilling site and lament the scarring of the land. Doug Duskin of Kennicott, Inc. said, "Good luck on your campaign, sir, but don't do it on the backs of the mining companies."

Finally, in December of 1992, with 65% of the proposed 40 test holes drilled and 100% of the money in the consortium's account gone, Phase I was declared complete. Turn around and it's 1993 and things were getting pretty tense between the state and the mining consortium. The mining interests complained that they were bearing all the expense while the state retained all the control and they balked at undertaking Phase II. After all, Phase I was supposed to cost $350K and take ten weeks. It actually took three years and cost (their figure) $590,137.04 and only two thirds of the test holes they bought actually got drilled. They also had some complaints about the expenses incurred by Director of Testing John S. L. Morgan. Who wants to go through that again with the stakes ten times as high?

Since the consortium was reluctant to undertake Phase II, Governor Clinton's Diamond Task Force (remember them?) created a subdivision called Phase Ib, which was to consist of administrative preparations for Phase II and was to cost $110,544. Parks and Tourism Director Davies put it bluntly, "Pay up or get out."

They paid up. Doug Duskin of Kennecott said in a joint budgett committee meeting that the Crater of Diamonds was probably the 8th largest diamond producing field in the world, and if mined at the rate of 6000 tons a day, would produce enough ore to last 36 years.

Parks and Tourism approved Phase II pending approval by the National Parks Service. It will cost $22,500 to prepare the proposal to ask for that approval. That figure does not include preparation of an environmental impact statement, which mining opponents say is required to comply with the National Environmental Policy Act.

Stop the presses! A cyanide leaching pond in Galactic's gold mining operation in Summitville, CO has leaked, causing an unfathomably expensive ecological disaster. Galactic Resources, Ltd. declares bankruptcy. Galactic is the primary partner in Continental Diamonds and provided much of the technical expertise, and Parks and Tourism Director Davies announces in February of '94 that Continental, headed by James Cairns no longer has the necessary know-how or resources to take part in the consortium. They will, however, be given a chance to re-qualify.

You've been expecting this mining metaphor to come up. Somebody's about to get the shaft and it's James Monroe Cairns. He's the businessman boy wonder (At least he was young when this madness began in 1983.) who's been involved in this thing since Anaconda's exit and he's about to get forced out. Cairns was the founder of Diamond Exploration, Inc., which was one of the companies that Texas Star Resources bought in order to ante up for this game. T.S. alleged that during sales negotations Cairns passed himself off as a geologist when he had no degree in geology. Therefore, failure of the new Continental to qualify is the fault of Cairns, not Texas Star.

There was a settlement the exact terms of which were kept private, but the upshot of it was Cairns got to keep the stock in Texas Star which he had been given in exchange for Diamond Exploration, Inc. and in return for that he would kindly go away and do something else and let an experienced diamond miner and credentialled geologist (by the name of J. David Edwards of San Antonio) take the helm. Also as a result of this deal, Texas Star acquired full ownership of Continental.

Cairns went from the top of the heap to the bottom of the barrel. Within six months he was doing ninety days for DUI and criminal tresspass and had been fined and cited for contempt. The next year he was suing other associates for misappropriation of funds and nonpayment of loans.

Meanwhile, back at the assylum, the federal government was clarifying what it meant by "temporary nonconforming use." The whole concept of "temporary nonconforming use" was built around one case in California. It seems there was this school that was being leaked on by hazardous waste. Nearby there was a municipal park that had been subsidized with federal money. Kind of the same deal as the Crater of Diamonds. So that the school could erect a temporary building on the park land, the congress got personally involved (CA has a lot of electoral votes.) and wrote the "temporary nonconforming use" rule, and thus by accident opened the door for test drilling for diamonds in an Arkansas park.

Well, things had not moved swiftly in California, and that "temporary" building was still in its park five years after it had been put up. As that situation dragged out, the notion of "temporary nonconforming use" got broader and broader. So guess what happened. Right! Congress got involved again. The sensible thing would have been the repeal of the "temporary nonconforming use" rule and have the Secretary of the Interior simply grant permission for the school to stay in the park. But this is Congress, and when they discovered they'd made a dumb rule, their solution was to make a bunch more rules to limit the damage done by the dumb rule. These guys keep score based on laws passed, not on laws repealed.

So here are the new 1994 rules regarding "temporary nonconforming use." 1) Duration not to exceed six months. 2) Limit scope of nonconforming use such that there is no "significant impact on public recreational use." 3) No permanent damage or change in the park. 4) Assure all alternatives have been considered.

Robert L. Fortune of Brinkley wrote a letter to the editor that was probably the most sensible thing anybody ever said about this mess. He pointed out that national parks are built around unique geographical features in order to preserve those feature. Examples are Yellowstone, Hot Springs, the Grand Canyon and Yosemite. The Crater is either a park or a mine.

Texas Star bought a bunch of leases on private land outside the park. Then they bought a state-of-the-art, high-tech, multi-million-dollar, x-ray fluorescing, centrifugally sorting, turbocharged, South African diamond sorting plant and assembled it in high-security compound within a mile of the Park. The dirt goes in, and diamonds come out, untouched by human hands. Even the professional manual gravel sorters have to reach into sealed gloves through a transparent barrier just as if they were handling nuclear material.

Winter of 1994-95 was a pivotal time for all involved. Assistant Regional Director Shellenberger of the National Parks Service insisted on the filing of an environmental impact statement before Phase II. The EIS was to contain estimates of economic and environmental impact, should commercial mining be allowed. State Parks guy Davies balked at that, saying that information from Phase II was necessary to determine the type of commercial mining that would best exploit the resource. Any evaluation of economic and environmental impact was impossible until data from Phase II was compiled.

National Parks eventually agrees with Davies on the EIS issue, but asserts that should commercial development occur, the value of alternate land would be based on the value of the diamonds. Davies quipped to the press, "Let's say the value is five billion dollars. That means we'd have to buy Louisiana."

You've got to know when to fold 'em, and that's what Kennecott and Capricorn did at this point. They diplomatically said that expenses kept rising and progress was slow, and getting any movement out of the state bureaucracy was just not worth the trouble. They had fish to fry in other parts of the world, so bye bye, had fun.

J. David Edwards of Texas Star said, "It's a frustrating situation. We're all frustrated, but I don't give up so easily." Now isn't that just like a Texan? All these business interests and environmentalists and state bureaucrats have been beating the crap out of each other for a decade. Texas Star buys in late, after Phase I was completed. Edwards drops into the top spot of his partnership just six months ago. He's fresh as a damn daisy. "I don't give up so easily." If you wonder why Arkansans hold the opinions they do about Texans, this is why. The guy shows up late to the party and because he's the only one not drunk he says he's the only one who can hold his liquor. Texans have a boundless confidence based on nothing, and they're outrageously successful. We resent them for that.

1996, the National Parks Service approves Phase II. Eleven trenches were to be dug, each measuring 4ft wide by 20 ft deep by 100 ft long. 9,000 tons of ore were to be excavated and sorted.

Texas Star, the partner that bought into the Continental partnership and ended up owning the whole ball of wax, offered to lease its conveniently located diamond sifter to the consortium for Phase II. And speaking of Phase II, there was one peculiar amendment to the agreement between the state and the consortium, a provision that prohibited further bulk testing of the Crater for 20 years. (The Morgan Report erroniously said it was outlined in the Arkansas Code, 22-5-817. I tried to look this provision up, but neither I nor the research librarian at the U. of A. School of Law nor the researcher at the Legislative Council were able to find it. I spoke with Mr. Butts of Parks and Tourism, and he told me it was in the contract between the state and the remaining two consortium partnerships.)

Ashton mining buys in, reimbursing Continental (Texas Star) for its expenses in return for a 51% interest in the venture.

Testing began on 2 October 1996, but the real action was going on in courtrooms all across the country. Everybody was suing everybody else. Some former investors of Jean-Raymond Boulle alleged that Exidiam sold leases to DFRI at below market value through an intermediary named Robert Friedland (who was the top guy at Galactic at the time of the Colorado disaster), sacrificing Exidiam's interests to Diamond Field Resources. Boulle was head of both companies, and both companies were partners in Continental. Can't tell the players without a program! Boulle was also being sued by Lyda E. Talmers, who said she was promised a 5% interest in Boulle Group in exchange for her working on mergers and acquisitions which resulted in Boulle Group consolidating into Diamond Field Resources. She also alleged fraud for him not informing her of some stock transactions or the existence of certain other investors.

Inco buys in. Inco is the world's largest producer of nickel. When DFRI was looking for diamonds in Canada, it discovered huge deposits of nickel, prompting Inco to purchase interest in DFRI.

Bulk testing halts on 19 October due to a suit filed by Friends of the Crater, who say an environmental impact statement should have been filed. The delay ends after a week when the judge finds that the consortium has touched all the necessary legal bases.

The consortium leases the modern sorting plant that Texas Star built to analyze bulk samples from its private leases. In order to avoid a conflict of interest, Bateman Engineering was hired to supervise processing of bulk samples and Lakefield Research was put in charge of sorting. Texas Star employees were prohibited from entering the plant during Phase II and were prohibited from having any contact with employees of the processing or sorting companies. There was designated a "participant plant coordinator" looking out for the interests of the consortium, Mr. Dearn Lee of Ashton Mining, who was involved in the testing and had access to all records. No account that I read reasons why Texas Star personnel were excluded while an employee of Ashton (Texas Star's 51% partner in Continental) was given managerial access.

1997 and Phil Terrell, President of the Murfreesboro Chamber of Commerce, says testing has hurt tourism. Apparently people hearing of the testing think the park is closed. To make matters worse, the results are disappointing. Big diamonds are not turning up, and those that are found are of low quality. This also discourages tourists. In May, a bill is introduced in the state house of representatives to require that interests wanting to mine a state park will require voter approval.

17 October 1997, John Morgan submits his final report, and it's a shocker. According to this study, you'd be more likely to find a genuine diamond on the Home Shopping Channel. 8792.83 tons of ore yielded a mere 45.748 carats of diamonds. A teacup full. Nine grams. Two Jefferson nickels weigh ten grams. The quality of the diamonds was evaluated by Solow & Co. of New York, and they arrived at an average value of $12.30 a carat. The diamond equivalent of junk food. Divide the yield by the 180 days scheduled for the bulk tests, and we find that this army of expert diamond miners with their excavators and their $4M dollar diamond sorters managed to find 1/4 carat per day.

Hold the damn phone. A troop of girl scouts scraping in the furrows with plastic spoons will find more than 1/4 carat a day. Refer to paragraph two of this article. The tourists collectively turn in more than 1/4 carat a day. The regular prospectors individually with their plastic buckets and window screens find more than 1/4 carat a day, and they mostly search the tailings of old commercial operations, dirt that has already been examined once.

The Texas Star Plant found 1/2 carat per 100 tons of ore, by far less than any of the primitive commercial mining operations from before WWII.

Morgan couldn't even come up with a credible excuse. Grasping at straws he offered that they had intentionally avoided areas that had been previously mined in order to examine undisturbed ore, and therefore avoided areas known to be most productive; but some of their trenches were just a few yards from old commercial trenches, so that one doesn't really fly.

Given the relative success of primitive methods compared to the more sophisticated, automated methods employed in Phase II leads me to conclude that... aaahhhh... FOR CRYING OUT LOUD, WHAT HAPPENED TO THE DAGGUM DIAMONDS? WE ALL KNOW THEY'RE IN THERE! WHAT GIVES?

I've got the answer, and it's not one that you expect.

Were the diamonds pilfered by a technician at the sorting plant? No way, man. If the security measures I read in the Morgan Report were followed, it would have been easier for a diamond technician to sneak into a silo and launch a nuke. What about a Bateman or Lakefield? Forget it. Because of the public and controversial nature of this project, Bateman and Lakefield would have sent their most trusted Boy Scouts. Those two companies would not have risked their reputations for the quantity of diamonds that was likely to turn up.

That leaves Texas Star and Ashton because the other consortium member had no access to the plant ever. But the most optimistic prediction I found expected all of Phase II to produce 3000 carats of diamonds at $50 a carat. Why would a company spend $4 million on a diamond sorter and $2 million on a geological survey of a park in order to pocket at most $150,000 worth of diamonds?

They might have something to gain by discouraging competition for private leases. A poor assay of the park might help do that, and as of this writing Texas Star Resources is the only diamond company mining private leases in Pike County (after a minor name change to Star Resources).

But if someone wanted to put the stink of failure on Arkansas diamonds, this is overkill. If somebody in the mining business were going to arrange a lie, they would certainly have arranged a more believable lie. The conclusions of the Morgan report are so outrageously bad that even a casual comparison between Phase II and earlier mining operations would result in the Phase II data being disregarded utterly. And this is an appropriate place for me to say that this has turned out to be a huge waste of time and money. We don't know any more about the value of our diamond crater than we did 20 years ago when the Department of Commerce was approached by Anaconda. Furthermore, because we rode this idiot-go-round, we've now got a law on the books which represents an even greater barrier to discovering the true value of the crater.

Who else could have gained by a bad report? The environmentalists and DeBeers. I don't think the environmentalists had access to the plant, and even if they did, I don't think they'd have the technical knowhow to rig the result.

Down through the decades, various Arkansas diamond interests have accused London and Praetoria of meddling in the Arkansas diamond industry, and from time to time it seems likely that the diamond cartel has done just that. You can't have a chicken ranch without thinking a lot about what Don Tyson is up to and you can't dig diamonds without being aware of DeBeers.

I can't positively eliminate the diamond cartel as a suspect. They've been at this game a long time and they're pretty sophisticated and well-connected, and if they wanted to commit their resources to making this inventory turn out the way it did, I reckon they could arrange it in such a way that li'l ol' me couldn't catch them at it; but I don't think that happened, and here's why.

A politically unstable Russia could dump warehouses full of diamonds on the market any time without warning. The post-apartheid government of South Africa might not be as easily influenced by DeBeers as the apartheid government. It is possible to make gem-quality diamonds in the laboratory now. Sooner or later production methods will improve and the prices will come down. Once upon a time the diamond cartel could have maintained its monopoly by locking up all the diamond producing real estate. Today, however, such maintenance relies on fragile agreements with unstable or even hostile governments and other giant corporations with divergent interests. One little crisis, one little interruption in America's diamond supply and the boys at General Electric will be making diamonds faster than rabbits make raisins.

In short, DeBeers has more to worry about than the suitcase full of natural stones that might eventually come from the Crater of Diamonds. World events placed us beneath their notice back in the mid 1980's. If they're screwing with us, it's out of habit and not because they have anything to gain. They could have achieved all their goals by sitting on the sidelines and maybe funneling a little cash, earmarked for this effort, to the opposition. If commercial mining had been approved, DeBeers could have just bought the diamonds. Problem solved.

So those are the not answers. A few paragraphs ago, I smugly asserted that I had the answer.

THIS DIAMOND AIN'T LIKE THAT DIAMOND

In 1923 Henry Ford took a packet of Arkansas Diamonds to test in his machine shop. He reported to Millar that the diamonds lasted 28% longer than regular diamonds in cutting, drilling and grinding tools. I called Bill Underwood, a certified gemologist in Fayetteville and he confirmed that Arkansas diamonds are marginally harder than other diamonds. An article in the Arkansas Democrat described the cutting of The Star of Arkansas. Normally during bruiting (lathing the diamond into a symmetrical shape) 1 carat of industrial diamond is used as a bit to wear away each 1 carat of gemstone. In the case of The Star of Arkansas, it took 8 carats of carbonado to wear away each carat of gemstone. A carbonado is a black diamond used as a bit to cut gem quality diamonds. They are harder than a regular diamond and have a lower specific gravity.

If Arkansas diamonds are physically different from African Diamonds, that physical distinction does necessarily require a chemical or structural difference or both. I asked Bill Underwood if Arkansas diamonds were any more or less dense than African diamonds. He said he was pretty sure that any difference in specific gravity was negligible, but as far as he knew nobody has ever checked with anything other than specific gravity fluid.

Okay, so that means we know that Arkansas Diamonds have a specific gravity of at least 3.3, while generically diamonds weigh in at 3.52 times the density of water. But if it turned out that most Arkansas diamonds had a specific gravity of, say, 3.4, would that affect recoveries in a Dense Mass Separator?

And if the extra hardness of Arkansas diamonds is due to some elemental difference, might that not affect X-ray fluorescence emission spectrum? I mean, if your XRF machine sees a diamond glowing at an unexpected wavelength, it's going to decide that's not a diamond and will pass that rock like a kidney stone.

So those are two things you can try, Mr. Edwards. Try resetting the cut point on your DMS to 3.0 and go down to the Crater and buy 100 carats of hand-and-eyeball sorted Arkansas diamonds from the fellows wearing the neoprene gloves and use those diamonds to recalibrate your XRF sorter.

If it turns out that I'm right, send a coffee mug full of diamonds to the address on your screen...

WINNERS AND LOSERS

It's hard to sort out the winners and losers in this whole episode. The Environmentalists got what they wanted, a law prohibiting commercial mining of the Crater of Diamonds State Park. Surely the London diamond cartel was glad to hear that an extensive and public survey of the Crater of Diamonds found virtually no diamonds.

Star Resources (formerly Texas Star Resources) came to Pike county to mine diamonds, and that's what they're doing as of this writing. J. David Edwards' high-tech diamond sorter is sifting dirt from private leases outside the park this very day, three years after the same machine couldn't find any diamonds inside the park. Those Texans have a way of dropping their toast jelly side up.

The state both won and lost. They achieved what they asked for in 1987, commercial mining and tourist prospecting side-by-side in Pike County. On the other hand, the Morgan report was a serious blow to their tourist attraction, and we still don't know what's under the ground, and that's what they wanted to know when they started dangling the carrot.

Kennecott and Capricorn bailed out after Phase I, not wanting to throw good money after bad. They probably lost less than a couple million bucks each, mostly in fees to local consultants and lawyers and P. R. firms. They go in the loser column. They lost, but they're big, reputable companies and they didn't get hurt too badly. I'm sure the next time they want to dig minerals out of the ground, though, they'll take their money and jobs to another state. Once bitten, twice shy. They bowed out politely through gritted teeth. And people wonder why Arkansas has a hard time attracting industry.

Arkansas Diamond Development/Rhombus and the others? Their loss was like Kennecott and Capricorn, except because of the involvement of local investment bankers Stevens, Inc. they had guys on retainer that the others had to hire. Friedman and Boulle got hammered with lawsuits while they were involved in this partnership.

Anaconda goes in the category with Kennecott and Capricorn.

James Cairns got trampled pretty badly. He was involved in the endeavor more than ten years, and he had his prize yanked from his grasp at the last minute by a Johnny-come-lately partner. He ended up in jail for contempt and DWI. Papers regarding his appeal somehow didn't get filed on time and he did his 90 days. He also had some legal problems over controlled substances.

Overall nobody involved in the great Crater of Diamonds fiasco ended up looking very good. The winner of a possum race is still a possum.

RTJ--10/1/2000

APPENDIX I: THE LARGEST ARKANSAS DIAMONDS

DATE SIZE NAME QUOTES OR COMMENTS
1924 40.24 Uncle Sam Emerald cut, the stone now weighs 12.42 carats and sold in 1971 for $150,000. There's a replica on display in the park museum.
1964 34.25 Star of Murfreesboro Appraised at $45,000 uncut in 1964.
1926 27.21 Searcy Found near Searcy about 175 miles from Crater of Diamonds. Probably once part of some Indian's trade goods. Yet uncut and on display at Tiffany's in NYC.
1911 17.85 Unnamed Yet uncut, in the collection of the National Museum of Natural History.
1975 16.37 Amarillo Starlight Found and named by a visitor from Amarillo, TX.
1956 15.31 Star of Arkansas Found by a visitor from Dallas. Named by Governor of Arkansas. Cut to 8.27 carat marquise.
1981 8.82 Star of Shreveport Found by a visitor from Shreveport, LA.
1960 6.43 Garry Moore Diamond Probably the only diamond named for a game show host. Trisoctahedron.

RTJ--9/1/2000

APPENDIX II: PERTINENT ARKANSAS LEGISLATION
ACT 793 of 1987

AN ACT to Permit the Parks, Recreation and Travel Commission to Enter into Lease Arrangements for Commercial Production of Diamonds at the Crater of Diamonds State Park in a Manner Consistent with the Operation of the State Park; and for Other Purposes.

Be It Enacted by the General Assembly of the State of Arkansas:

SECTION 1. The Arkansas Parks, Recreation and Travel commission, hereinafter referred to as the Commission, through the Department of Parks and Tourism, is hereby authorized to execute a lease, after securing the advice of the Legislative Council, for the exploration and production of diamonds at the Crater of Diamonds State Park. The lease may be executed pursuant to the solicitation of bids or pursuant to negotiation without bids as may be determined by the Commission. The lease may include such area of the park lands and may provide for such royalty payment on the production of diamonds a the Commission may deem appropriate.

SECTION 2. The authority granted the Commission in this Act shall be exclusive and neither the povisions of Act 524 of 1975 (see below), as amended, nor any other provisions of law shall be applicable with respect to the leasing of lands in the Crater of Diamonds State Park for the exploration for and production of diamonds. The Commission, after securing the advice of the Legislative Council, shall have full authority to determine whether such lease shall be executed, the area of the park to be included in any such lease, the method of selecting the lessee, benefits and improvements for the park to be made by the lesse, the royalty payments to be paid the Commission by any lessee, and any and all other terms of the lease.

SECTION 3. If a lease is executed by the Commission for the exploration and production of diamonds at the Crater of Diamonds State Park as authorized herein, seventy-five percent (75%) of all royalty payments received by the Commission under the lease shall be depositied by the Commission in the State Treasury as "general revenues" and shall be allocated and distributed to various funds and fund accounts in the State Treasury as is provided for other general revenues. The remaining twenty-five percent (25%) of all royalty payments received under such lease shall be State Parks cash funds and shall be retained by the Commission and deposited in an appropriate account. The first two hundred thousand dollars ($200,000.00) of the royalty payments retained by the Commission each year shall be spent for maintenance and improvements at the Crater of Diamonds State Park and the balance thereof shall be used for such purposes as may be prescribed by appropriation of the General Assembly.

SECTION 4. All laws and parts of laws in conflict with this Act are hereby repealed.

APPROVED; April 8, 1987

ACT 524 of 1975

AN ACT to Vest in the Department of Commerce the Authority and Responsibility for Granting Leases and Permits for Taking Sand and Gravel, Minerals, and Timber From State-Owned Lands; to Establish the Natural Resources Committee and to Prescribe its Functions and Duties; to Provide for Appropriate Investigation and Supervision of the Activities of such Leaseholders and Permittees on State-Owned Lands; and for Other Purposes.

Be It Enacted by the General Assembly of the State of Arkansas

SECTION 1. Hereafter, no person, firm, company, corporation, or association shall take any sand and gravel, oil, natural gas, casinghead has, coal or other minerals or sever any timber from the beds or bars of navigable rivers and lakes in this State or from any other lands or interest in lands held in the name of the State of Arkansas or any agency, department or institution of the State, including tax forfeited lands, unless such person shall have first procured a lease or permit to do so from the Department of Commerce. Any person, firm, company, corporation or association desiring to take sand and gravel, oil, natural gas, casinghead gas, coal or other minerals or to sever any timber from such state-owned lands shall make application for lease or permit to do so to the Department of Commerce. Each such application shall be on forms prescribed by the Department of Commerce and shall contain such information as shall be prescribed by the Department of Commerce regarding the applicant and the business of the applicant, the sand, gravel, minerals or timber proposed to be removed from such lands under the lease or permit and such other information as the Director of the Department of Commerce shall deem necessary and appropriate to properly protect the interests of the State and to assure that the leaseholder will in good faith carry out all his responsibilities under the lease or permit. Every lease or permit issued under the provisions of the Act shall define the limit of the area from which the lessee or permittee shall be permitted the exclusive right to take the sand, gravel, minerals or timber designated in the lease or permit. Each lease or permit issued by the Department under the provisions of this Act shall be for a specific term as may be determined by the Director of the Department of Commerce, shall require that reasonable commercial production of the sand, gravel, mineral or timber covered by the lease or permit shall commence wiithin a specified period of time as determined by the Director, shall provide that the lease or permit shall automatically terminate unless such commercial production is commenced within the time prescribed unless extended by the Directoru upon a showingh that expenses have been incurred and actual operations are in process of completion for the commercial production of the oil, natural gas, casinghead gas, sand, gravel, coal, or other minerals or the severance of timber under such lease or permit. Once reasonable commercial production is commenced under any lease or permit issued hereunder, the lease or permit shall automatically terminate if such commercial production shall cease for a period of six (6) months, or such other period as may be prescribed in the lease.

SECTION 2. The Natural Resources Committee, hereby created and composed of the Director of the Department of Commerce, the Director of the Oil and Gas Commission, the State Geologist, the Director of the Forestry Commission, and the Director of the Soil and Water Conservation Commission, with the Director of the Department of Commerce as Chairman, shall establish a schedule of minimum fees and royalties, and the terms and conditions for various types of permits and leases and no permit or lease shall be granted for less than the minimums prescribed in the schedule. The Committee shall prescribe the permit and lease forms and shall have the authority to change the schedule of minimum fees and royalties and the terms and permit and lease forms from time to time.

Any person applying for a lease or permit under the provisions of this Act shall offer in the application to pay at least the minimums prescribed in the schedule for the lease or permit. Upon receipt of an application for a lease or permit, the Department of Commerce shall determine whether issuing a permit or lease would be in the best interests of the State of Arkansas, and if so, the Department shall, within ten (10) days thereafter, cause to be published in a newspaper iof general circulation in this State and a newspaper of general circulation in the county or counties in which the property is located, a notice that such application has been filed. Such notice shall contain a description of the permit or lease sought and the minimum fee or royalty and the terms and conditions prescribed for such permit or lease, and shall state that persons may bid on the lease or permit by filing a bid thereon in writing with the Department within twenty (20) days after the date of such publication.

If no other bids for the lease or permit are filed with the Department within the twenty (20) day period, the same shall be awarded to the person applying therefor. If any person or persons other than the original applicant files bids with the Department for such lease or permit within the time prescribed, the original applicant shall have first option to claim the permit or lease for the highest fee or royalty bid on such permit or lease. If the original applicant does not exercise the option within ten (10) days after the deadline for receiving bids, the permit or lease shall be awarded to the higest bidder.

SECTION 3. When an application for a lease or permit is filed with the Director of the Department of Commerce for the taking or production of any sand and gravel, oil, natural gas, casinghead gas, coal, or other minerals or the severance of any timber from state-owned lands, the Director shall so notify the Division of Geology, the Soil and Water Conservation Commission, the Oil and Gas Commission, the Game and Fish Commission, the Department of Parks and Tourism, the Department of Pollution Control and Ecology, the Forestry Commission, or any other appropriate State agency which has or may have a particular interest in the area proposed to be covered by the lease or permit, and any such interested agency shall have an opportunity to investigate the proposed production or taking of sand, gravel, or minerals or severance of timber under the lease and to report its findings and recommendations to the Department of Commerce regarding the same, including any recommendations for the conditions or limitations to be imposed on the lessee with respect to the production of sand, gravel, minerals or the Director of the Department of Commerce may deny an application or may grant a permit or lease subject to such conditions and requirements as he deems appropriate to properly protect the interests of the State of Arkansas; provided however, that no permit or lease shall be granted on interests held in the name of or managed by a State agency or institution without the written consent of such agency or institution. Provided, the issuance of a permit shall not be unreasonably delayed without justifiable cause.

Before any lease or permit is granted by the Director of the Department of Commerce for the severance of timber from any lands belonging to the Game and Fish Commission, and before the Game and Fish Commission may grant its permission for the issuance of such lease or permit for the cutting of said timber, the Game and Fish Commission shall, prior to granting its permission fo the issuance of such lease or permit, cause an environmental impact statement to be prepared, and shall file a copy thereof with the Environmental Preservation Commission, or its successor agency, which Commission shall then hold public hearings thereon in order to make recommendations to the Game and Fish Commission in regard to the environmental impact of said proposed cutting of timber upon the environment of this State.

SECTION 4. Every person obtaining a lease or permit hereunder shall keep an accurate record and account of all sand and gravel, oil, natural gas, casinghead gas, coal and other minerals taken from lands, and all timber severed from the lande covered by the lease or permit and shall file with the Arkansas Revenue Depaertment monthly an itemized, verified statement of the total number of cubic yards of sand and gravel, the barrels of oil, thousands of cubic feet of natural gas and/or casinghead gas, tons of coal, and the conventional weight or volume of any and all other minerals, and timber taken under the lease during the preceding month. This report shall be filed in duplicate, and the Arkansas Revenue Depaertment shall furnish the Director of the Department of Commerce monthly the second copy of each such report.

At the time of filing such report, the lessee or permittee shall pay the severance tax in the same manner and at the same rate as all other severance taxes presently are hereafter collected by the Arkansas Revenue Department. The lessee or permittee shall also pay at the same time, and in addition to all severance taxes and royalties, such amount of actual consideration for the sand, gravel, minerals or timber severed from the state-owned lands under the conditions of the lease or permit issued by the Director of the Department of Commerce. The Direcotr of the Department of Commerce shall further be authorized to require the posting of a corporate surety bond by any lessee or permittee to guarantee the payment of such taxes, royalties, and consideration.

All funds received by the Department as fees, compensation or royalties for leases or permits issued for the taking of any sand and gravel, minerals, or timber from lands owned or held in the name of a state agency or institution shall be special revenues and shall be deposited in the State Treasury and credited to the fund, or account from which the agency or institution receives its support. All funds received by the Department for leases or permits for the taking of any sand and gravel, minerals or timber from all other state-owned lands shall be deposited in the State Treasury as general revenues.

SECTION 6. The Department of Commerce shall be responsible for conducting a continuing check of the operations by lessees or permittees to assure that the lessee or permittee is meeting all the requirements and complying with the conditions of the lease or permit and the provisions of this Act.

SECTION 7. Each person, firm, company, corporation, association, or other business entity holding a lease or permit for the taking or production of any sand and gravel, timber, minerals or other natural resources referred to in this Act, shall be absolutely liable for all severance taxes, royalties, and actual consideration for all such sand and gravel, minerals produced or timber severed under such lease or permit regardless of whether such lessee or permittee is actually producing or severing the minerals or severing the timber from the land.

All leases or permits issued under authority of this Act shall be transferable only with the approval of the Director of the Department of Commerce. Any lease or permit transferred in violation of this Section shall be subject to cancellation by the Director.

Upon the expiration of any lease or permit issued under the authority of this Act, such lease or permit shall not be renewed or reissued except that application therefore be filed with the Department and the same procedures followed as are prescribed herein for the initial application for and the granting of a lease or permit.

SECTION 8. Any person, firm, company, corporation, state agency, or other business entity holding a lease or permit on the effective date of this Act for the taking or production of any sand and gravel, minerals or timber, from state-owned lands shall be permitted to continue to sever sand and gravel, minerals or timber from state-owned lands in accordance with such existing lease or permit. Provided however, every person holding any such lease or permit on the effective date of this Act shall within one year from the effective date of this Act file a copy of the lease or permit or other proof of such lease or permit with the Director of the Department of Commerce. If any such permittee or lessee shall fail to file a copy of the lease or permit or to furnish other evidence therefor to the Director of the Department of Commerce within one year from the effective date of this Act, such a lease or permit shall be subject to cancellation by the Director of the Department of Commerce. The State of Arkansas and all State agencies and institutions shall notify insofar as possible, their permittees and lessees of this requirement as soon as possible after the effective date of this Act.

SECTION 9. If any person, firm, company, corporation or association shall remove any sand, gravel, oil, natural gas, casinghead gas, coal or other minerals, or any timber from the beds or bars of navigable rivers and lakes in this State or from any other lands or interest in lands held in the name of the State of Arkansas without first obtaining a lease or permit to do so from the Department of Commerce, such person, firm, company or corporation shall be deemed guilty of a misdemeanor and upon conviction thereof, shall be opunished by a fine of not less than three hundred dollars ($300.00), and not more than one thousand dollars ($1000.00), and each day of unauthorized taking shall constitute a separate offense. In additon to the fine mentioned, the Attorney General may bring suit in the name of the State to recover the value of the sand, gravel, oil, natural gas, casinghead gas, coal, or other minerals or timber which has been illegally removed, as well as all severance taxes and royalties due as a result of such removal.

SECTION 10. The Department of Commerce shall promulgate any rules or regulations which may be deemed necessary to carry out the purpose of this Act. The Department of Commerce shall include in such rules and regulations all grounds and conditions for the revocation and/or termination of any lease or permit issued hereunder and shall provide for reasonable notice to said lessee or permittee an opportunity to be heard prior to terminating and/or revoking any lease or permit.

SECTION 11. The provisions of this Act shall not be applicable to the severance, sale or other dispositon of sand, gravel, timber or minerals salvaged, severed or removed by a state agency from lands held in the name of or managed by such agency when such sand, gravel, timber or minerals are salvaged, severed or removed in the course of managing, developing and improving such lands by the state agency.

SECTION 12. Any state agency, department or institution or any county, municipality or other division of goverbnment desiring to sever or take any sand, gravel, timber or minerals vfrom any lands held in the name of or managed by the state or a state agency, or from the beds and bars of rivers in this state, other than lands held in the name of or managed by the agency or division of government desiring to sever or take the same, shall obtain a permit to do so from the Department of Commerce but shall not be required to comply with the bid procedures or to pay any fee, royalty or taxes therefor or to otherwise comply with the provisions of this Act.

SECTION 13. It is the purpose and intent of this Act to charge the Department of Commerce with the authority and responsibility for considering applications for and granting leases and permits for the taking of sand, gravel, oil, natural gas, casinghead gas, coal and other minerals, and timber from the beds and bars of navigable rivers and lakes in this State or from any other lands or interests inn lands held in the name of the State of Arkansas, any State agency or institution, including tax forfeited lands, and to supervise activities on state-owned lands by lease-holders and permittees.

SECTION 14. Sections 1,2 and 3 of Act 296 of 1917, as amended, the same being Arkansas Statutes Section 10-1001, 10-1003, and 10-1004; Section 1 of Act 351 of 1941, the same being Arkansas Statutes Section 10-1002; Section 1 of Act 285 of 1943, as amended, the same being Arkansas Statutes SEction 10-1008; and Section 11 of Act 38 of the First Extraordinary Session of 1961, the same being Arkansas Statutes Section 10-1009, and all other laws and parts of laws in conflict with this Act are hereby repealed.

SECTION 15. It is hereby found and determined by the General Assembly that the present laws relating to the granting of leases and permits to take timber, sand, gravel, oil and gas, and other minerals from state-owned lands are inadequate to properly protect the State lands and to assure the State of adequate compensation for taking such timber, sand, gravel, oil and gas and other minerals from such lands; that this Act is designed to correct this situation by establishing appropriate procedures therefor and making provisiion for the receipt of adequate compensation therefor by the State and its institutions and agencies, and should be given effect at the earliest possible date. Therefore, an emergency is for the immediate preservation of the public peace, health and safety shall be in full force and effect from and after its passage and approval.

APPROVED: March 21, 1975

ACT 15 OF 1999
For An Act To Be Entitled

"AN ACT TO PROHIBIT COMMERCIAL DIAMOND MINING AT THE CRATER OF DIAMONDS STATE PARK; AND FOR OTHER PURPOSES."

Subtitle

"AN ACT TO PROHIBIT COMMERCIAL DIAMOND MINING AT THE CRATER OF DIAMONDS STATE PARK."

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:

SECTION 1: No commercial mining shall be permitted at the Crater of Diamonds State Park. Recreational mining by individuals shall continue to be permitted at the park.

SECTION 2: Arkansas Code 15-11-209 is hereby repealed.

15-11-209. Distribution of severance taqx generally. The State Parks, Recreation, and Travel Commission, as trustees of the Arkansas State Parks Trust Fund, shall manage the funds in the trust for growth and shall expend the income and principal of the trust as follows:

(1) Seventy-five percent (75%) of the revenues collected from diamond mining pursuant to § § 22-5-817 and 26-58-107 and paid into the trust each year and shall be spent, as appropriations are available, for the purposes of the trust as set forth in this section and § § 19-5-986, 22-5-817, 26-58-111(8), and 26-58-124; however, the amount annually expended shall not exceed ten million dollars ($10,000,000); and

(2) Twenty-five percent (25%) of the revenues collected from diamond mining pursuant to § § 22-5-817 and 26-58-107 and paid into the trust each year, plus all earnings of the trust, and plus all moneys paid into the trust and be added to the principal; however, after revenues from diamond mining are no longer received by the state, or thirty (30) years after August 13, 1993, whichever occurs earlier, the annual earnings of the trust may be expended, as appropriations are available, for the purposes of the trust as set forth inn this section and § § 19-5-986, 22-5-817, 26-58-111(8), and 26-58-124.

SECTION 3. Arkansas Code 19-5-968 is amended to read as follows:

"19-5-968. Arkansas State Parks Trust Fund.

(a) There is hereby created on the books of the Treasurer of State, Auditor of State, and Chief Fiscal Officer of the State a fund to be known as the Arkansas State Parks Trust Fund, there to be used by the State Parks, Recreation, and Travel Commission, as appropriations are available. The commission shall annually expend at least ninety percent (90%) of the funds available for the purpose of development, preservation, and protection of the infrastructure in the existing state parks of Arkansas., and for those purposes as set out in § 15-11-209."

SECTION 4. Arkansas Code 19-6-301(178) is hereby repealed.

(178)Crater of Diamonds State Park diamond exploration and production lease royalty payments, § 22-5-817;

SECTION 5. Arkansas Code 19-6-477 is hereby repealed.

19-6-477. Crater of Diamonds State Park Improvement Fund.

The Crater of Diamonds State Park Improvement Fund shall consist of the first two hundred thousand dollars ($200,000) of those special revenues as specified in subdivision (178) of § 19-6-301, there to be used by the State Parks, Recreation, and Travel Commission for maintenance and improvements as the Crater of Diamonds State Park, as appropriations are available, as set out in § 22-5-817.

SECTION 6. Arkansas Code 22-5-817 is hereby repealed.

22-5-817. Leasing at Crater of Diamonds State Park.

(a)(1) The State Parks, Recreation, and Travel Commission, through the Department of Parks and Tourism, is authorized to execute a lease after securing the advice of the Legislative Council for the exploration and production of diamonds att the Crater of Diamonds State Park.

(2)After securing the advice of the Legislative Council, the commission shall have full authority to determine whether the lease shall be executed, the area of the park to be included in any lease, the method of selecting the lessee, benefits, and improvements for the park to be made by the lessee, the royalty payments to be paid the commission by any lessee, and any and all other terms of the lease; provided, however, any lease executed by the commission shall contain plans for the continued operation and improvement of the park, including long range plans that provide "finders keepers" diamond hunting opportunities for visitors to the park.

(b)(1) The lease may be executed pursuant to the solicitation of bids or pursuant to negotiation without bids as may be determined by the commission.

(2) The lease may include such area of the park lands and may provide for such royalty payments on the production of diamonds as the commission may deem appropriate.

(c) The authority granted the commission in this section shall be exclusive and neither the provisions of § § 22-5-801 - 22-5-813 nor any other provisions of law shall be applicable with respect to the leasing of lands in the Crater of Diamonds State Park for the exploration for and production of diamonds.

(d) If a lease is executed by the commission for the exploration and production of diamonds at the Crater of Diamonds State Park as authorized in this section, the first two hundred thousand dollars ($200,000) of the royalty payments received by the commission under the lease shall b e deposited by the commission in the State Treasury as special revenues and credited to the Crater of Diamonds State Park Improvement Fund, which is hereby created on the books of the Treasurer of State, the Auditor of State and the Chief Fiscal Officer of the State and there to be used by the State Parks, Recreation, and Travel Commission for maintenance and improvements at the Crater of Diamonds State Park, as appropriations are available. The balance of the royalty payments shall be deposited by the commission in the State Treasury as special revenues and credited to the Arkansas State Parks Trust Fund, there to be used by the State Parks, Recreation, and Travel Commission, as appropriations are available. The commission shall annually expend at least ninety percent (90%) of the funds available for the purpose of development, preservation, and protection of the infrastructure in the existing state parks of Arkansas.

SECTION 7. All provisions of this Act of a general and permanent nature are amendatory to the Arkansas Code of 1987 Annotated and the Arkansas Code Revision Commission shall incorporate the same in the Code.

SECTION 8. If any provision of this Act or the application thereiof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are declared to be severable.

SECTION 9. All laws and parts of laws in conflict with this Act are hereby repeald.

APPROVED: 2/4/1999

Your Host comments: Arguments that the 1975 law was inadequate for dealing with leases regarding the taking of diamonds from state-owned lands are bogus. The 1975 law would have required an open bidding process. The 1987 law allows Parks, Tourism and Travel, acting without approval or oversight from anybody, to sell diamond leases through secret negotiations and requiring only the "advice" of the Legislative Council. Going by the 1975 law, the lease would have to be executed through the Department of Commerce and would have to be approved by Game and Fish (since the Little Missouri River flows through the park), The Department of Pollution Control, Parks, Tourism and Travel Commission, Division of Geology, Department of Soil and Water Conservation and any other state agency with any interest in the Crater. The new law doesn't stipulate the filing of an environmental impact statement, as the old law does. It looks to me like somebody had a law specially written so they could sneak in and grab our diamonds without worrying about competitive bids or environmental protection or approval and oversight from a half-dozen state agencies. The fact that the endeavor thereafter became so poisonous validates the principle of karma.


APPENDIX III: THE SEARCY DIAMOND

Once upon a time, back in 1929 little Alice Taylor was chopping cotton on her parents' farm in the community of Holly Springs near Searcy in White County when by an old stump she found a glassy oblong marble, not too clear, but on the smoky side, shaped like a tapered quail egg. She kept it with her throughout her childood, showing it to friends, playing marbles with it.

She married and had kids and she gave them the smoky marble to play with. Eventually in the course of play, the marble disappeared through a knothole in the floor. It stayed lost for about a year, but her oldest daughter found it again while crawling under the house looking for hens eggs.

One day in 1942, Alice showed the marble to Noel Crook, a drug store owner in Searcy. He said he thought the stone might be valuable and advised her to have it examined by the University of Arkansas at Fayetteville Geology Department. They said, yup, it sure was valuable and they told her to send it to Tiffany's in New York to find out just how valuable.

A few days later she got a call from a Tiffany's jeweler who offered her eighty five for the stone. Eighty five dollars was a lot of money in 1942, so Alice accepted. When the check arrived, she discovered that she had actually accepted an offer of eighty five HUNDRED dollars, which was also a lot of money in 1942.

The Searcy diamond is still on display at Tiffany's in New York. At 27 carats, it's the third largest diamond ever to be found in North America.

No other diamonds have ever been found in White County, so although Searcy is 170 miles from Murfreesboro, the Searcy Diamond probably originated there and made its way north as part of some Indian's trade goods or personal kit. Indians appreciated colorful doo-dads every bit as much as did Whitey.


APPENDIX IV: RELATED LINKS

Crater of Diamonds Article from Rockhounding Arkansas

Geological Map of Southwest Arkansas

Diamond Geology Primer

Online Minews from May 2000 with mention of Pike County Operations


APPENDIX V: CARATS

In medieval India, the diamond merchants used a seed of a carob tree as a convenient, cheap and universal unit of measure for diamonds. The word carat is derived from carob. The carat was standardized in Europe as 1/144th of an ounce, but has been restandardized to about 1/150th of a Troy ounce so as to be compatible with the metric system. Five carats is one gram.


Sources:

Arkansas Gazette and Democrat/Gazette, various, 1969-2000. If you want an individual citation, e-mail me at Traveller.

Hendrix, Bobbie Lou; Crater of Diamonds -- Jewel of Arkansas; B.L. Hendrix, Antoine, AR, 1989.

Millar, Howard A., It Was Finders-Keepers at America's Only Diamond Mine, Carlton Press, Inc.; New York, NY, 1976.

Morgan, John; Final Report (Draft) -- Crater of Diamonds State Park Evaluation Program; Morgan Worldwide Mining Consultants, 1997.


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