Diamond Joe walks away from Tahera

Joseph Gutnick, or “Diamond Joe” as he’s known in Australia, has quit his position at the top of the firm that’s planning to develop Nunavut’s first diamond mine.

In a terse press release issued just before the close of business last Friday, Tahera Corp. announced that Gutnick has resigned as president, chief executive officer, chairman, and director of the company.

Two other board members from Australia, David Tyrwhitt and Stephan Meyer, also quit Tahera’s board last week.

This past Wednesday, the company announced that Gutnick will be replaced by Peter Gillin, a career investment banker with experience in mining-related financial markets.

Gillin will take over as chairman and chief executive officer immediately, and has been appointed to Tahera’s board.

Colin Benner, the CEO of Breakwater Resources Ltd., which owned the former Nanisivik Mine, has been elected to Tahera’s board of directors. Benner serves on the board of several Canadian mining companies.

Tahera’s proposed Jericho diamond mine, in the Contwoyto Lake area of the Kitikmeot region, is small — but it would be Nunavut’s first.

In May 2003, Tahera thought it had found a buyer willing to take all of the diamonds that Jericho would produce, a firm called Lazare Kaplan of New York City. But Tahera will now allow that letter of intent to expire, and will finish plans to market Jericho diamonds by the end of this year.

The company must raise $50 million to build the mine, and it has to steer the project through an environmental assessment process run by the Nunavut Impact Review Board. Only after that happens will Tahera be able to apply for the necessary permits and licences needed to operate a mine in Nunavut.

Gutnick has been in charge of Tahera since June 2001, when he ousted the company’s founder, Howard Miller, in a boardroom coup.

At one time, Gutnick’s private family firm, Edensor, owned between 30 and 40 per cent of Tahera’s shares.

Through Edensor, Gutnick invested $13 million in Tahera shares, at a price of 15 cents a share. But when Tahera’s share price rose to around 40 cents in 2002, the market value of his holdings in the company rose to an estimated $30 million or $40 million.

Gutnick now controls only about 2.5 per cent of Tahera, and the Australian press has been predicting his departure from Tahera for several months.

Gutnick has been embroiled in an Australian legal action with his sister, and one of his companies has started test drilling at a site in Western Australia.

“With things looking up at home, is Diamond Joe Gutnick turning his back on Canada?” columnist James Chessell wrote in the Sydney Morning Herald last August.