Rio Tinto Group, the world’s third- largest mining company, said its Bunder project in India is the world’s biggest diamond discovery in the past 10 years, Bloomberg reported.

“It’s in a pre-feasibility study right now so a major drilling program is under way to define the resource,” Eric Finlayson, the London-based company’s head of exploration, said today in an interview with Bloomberg in the city. “A mining lease has been applied for so we are waiting on that. It’s the largest diamond discovery in the last 10 years.”

Prices of rough, or unpolished, diamonds have risen during the past year, returning to levels last seen in June 2008, after producers including De Beers cut output, gem dealers rebuilt stockpiles and demand rebounded. Rio last week said it will invest $803 million to complete the underground expansion of its Argyle diamond mine in Western Australia state, said the report.

Diamonds are “one of the few commodities where it does look as if there are geological limitations on new discoveries,” Finlayson said. “The simple fact is there have been very few diamond discoveries in recent years by anyone and this is one of the biggest ones.”

The Bunder project is located about 500 kilometers (311 miles) from Delhi in Madyha Pradesh. The deposit has an estimated inferred resource of 37 million metric tons at a grade of 0.7 carats per ton for 27.4 million carats, the report said.

“Our exploration effort continues in India for other diamond deposits,” Finlayson said. “I’m pretty sure that we’ll be successful.”

The company is also studying “early stage opportunities” for potash projects and is in talks with unidentified Chinese companies about mineral exploration joint ventures in the country, Finlayson said.