Dominion Diamond Corp. is officially the new owner of the EKATI diamond mine in the Northwest Territories after closing the $500-million deal with BHP Billiton last Wednesday.
Formally known as Harry Winston Diamond Corp., Dominion has acquired BHP’s 80 per cent interest in the mine located 310 km northeast of Yellowknife, which makes it the first Canadian company to hold a majority share in a diamond mine.
The company, based out of Toronto, also owns a 40 per cent share of Rio Tinto’s Diavik mine, just south of EKATI.
“We’re looking to try and build something with lifetime and strength to be a serious player in not only the North, but also the world diamond industry,” Robert Gannicott, Dominion’s chairman of the board and CEO, said during a press conference on Apr. 10.
He also noted that while they are not planning to expand the current workforce at the moment, they are moving key players who have previous experience in sorting, management and sales to Yellowknife from Toronto.
“This is a mine that’s been very well constructed by its previous owner and it’s got a workforce that is very well trained and competent,” Gannicott said. “We’re going to build on what’s already been created. We’re not looking to take it away or reduce it in any way…This company will have a management that is local and therefore responsive so that we can more quickly, sensibly make decisions right here.”
Impact and benefit agreements between local Aboriginal groups, environmental arrangements with the federal government and socio-economic agreements with the GNWT are not impacted by the sale. The contract covering the mine’s unionized workers will also remain unchanged.Established in 1998, EKATI is Canada’s first diamond mine and is estimated to have only seven years of production left. Dominion wants to see that lifetime extended.
“From Diavik, we know diamonds well…EKATI has some large scale resources and they’re not easy to get at or they’d have been mined already, but in the context of improved mining techniques and an improved diamond market, we believe there is a much longer future for EKATI,” Gannicott said.
The company plans to continue with exploration efforts on the properties adjacent to EKATI and Diavik.
“We’re convinced there’s more diamonds out there, so we’re interested in exploration and we know with Dominion that work will happen and we have every confidence in that. We’re hopeful we can see the mine life well extended into the future, which has been a concern, and that we’ll be mining diamonds here in the NWT for decades to come,” David Ramsay, minister of Industry, Tourism and Investment, said during the press conference.
Dominion first announced the proposed purchase in November, but the sale, subject to regulatory approvals, wasn’t secured until Apr. 1.
NWT Premier Bob McLeod said he’s known Gannicott, who got his start in mining out of Yellowknife, a “long time” and appreciates Dominion’s commitment to the NWT.
“Bob Gannicott is an example of what can be done when the people who know this territory the best, the people that live here, are making the decisions about how and where to develop our resources,” McLeod said. “We need more development like that and we expect to see that when our government takes on the responsibility for public lands, water and resources with the implementation of devolution in April 2014.”