NWT’s Ekati diamond mine to be sold for second time in two years

The Northwest Territories’ Ekati diamond mine is about to have a new owner – again. The mine is being purchased by Australia-based Burgundy Diamond Mines.

Burgundy said its proposed $187-million (US$136 million) deal to buy all of Arctic Canadian Diamond Company’s assets includes the entirety of Ekati, which Arctic Canadian only bought in February 2021.

In a news release, Burgundy said acquiring Ekati was “transformational” for the company, making it “one of the largest listed diamond companies globally.”

Burgundy said it would maintain Arctic Canadian’s plan to use underwater remote mining to extend Ekati’s mine life, and will also conduct an “assessment of the Jay deposit and Fox underground opportunities.”

The company had already been purchasing fancy-coloured rough diamonds from Ekati since 2021.

The deal is subject to Burgundy securing financing and receiving shareholder approval at a meeting expected to take place next month.

“We are confident that both Burgundy and Ekati have a very bright future,” Burgundy executive chair Michael O’Keefe said in a news release.

Exactly what the transaction will mean for Ekati’s existing workforce – some 1,100 people – was not immediately clear.

Arctic Canadian’s president and chief executive, Rory Moore, said the deal was “a significant positive development for Ekati and for the North.”

Kristal Kaye, Arctic Canadian’s chief financial officer, said the transaction would continue “to provide employment opportunities for many people in northern communities.”

Ekati was last sold in February 2021, when financially troubled Dominion Diamond Mines offloaded the mine to Arctic Canadian, a company formed by some of Dominion’s creditors.

In its two years in charge, Arctic Canadian oversaw the green-lighting of a project to mine a new open pit – Point Lake – designed to keep the mine alive for an extra four years.

The current plan calls for underwater mining, using giant crawlers controlled from afar, to keep the mine alive after that point.

A trial of the underwater crawlers is expected at Ekati’s Lynx pit in the summer of 2024.