Gope mine unlikely to take off

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Gem Diamonds is likely to face difficulties in building its diamond mine in Gope as the credit crisis bites, RBC Capital Markets has said.

The company said this last week as it downgraded its buying recommendation for Gem Diamonds following an interim management statement earlier this month and meetings with management.

"Capital market conditions make it unlikely the group will be able to raise the +/- $500 million needed to build a mine," RBC said. The company had originally planned to have Gope in production by 2010.

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