Amid ‘cost pressures’ Diavik offers staff ‘voluntary separation’

Rio Tinto has provided an option to its permanent Diavik employees to end their contract sooner than expected in the face of “continued cost pressures.”

On September 11, Diavik sent out an email to its staff, seeking expressions of interest for “voluntary separation” through an agreement. In a letter that was anonymously shared with Cabin Radio, the company stated it was looking to “reduce operating costs across the business.”

Asked about the letter, a spokesperson for Rio Tinto said the diamond mine is currently met with lower market prices for rough diamonds that have dropped back to pre-pandemic levels, “while costs have increased.”

“Diavik has been transparent about its upcoming closure and faces continued cost pressures,” the spokesperson wrote in an email, adding the mine regularly reviews its operation costs to work “efficiently through market cycles.”

“As part of our ongoing efforts to operate a sustainable mine in the Northwest Territories, Diavik is exploring the possibility of early voluntary severance opportunities for staff who are interested, as a first step in the journey to the responsible closure of Diavik.

“We continue to be committed to the safe production of diamonds, fulfilling our commitments to our workforce and northern community partners, and to closing Diavik responsibly. We are proud of our ongoing support to our people and our northern partners,” the email continued.

‘A lot of shifts’

During a media tour last month, Diavik representatives said the mine looked forward to a “successful closure,” which the team has been preparing for “since day one.” While production is expected to end in 2026, closure and reclamation will go into 2029.

Through its two-decades-long operation, the mine opened doors for employment to thousands. As of August 2024, officials said 1,330 people worked on-site.

Diavik began developing its My Path program in late 2020, to help staff find employment after the mine closed, according to program lead Amber Robertson. She said a feasibility study was conducted to understand what employees wanted out of the program and how the mine could support the transition.

“We took those pieces of information and certain data points to see what we can provide as far as support on-site. Then, developed a framework from there,” she said.

“Right now, what we’re seeing is that the people that are participating in My Path are very much excited about getting a plan going so that they do have a true plan in place when their time comes to end at Diavik.”

As an example, Robertson said last year individual sessions on resume writing were offered to some employees in the surface mining department, who were able to transfer to new roles within the company. Other staff chose to retire and the program assisted them with financial planning.

“I think it brings a lot of questions. I think sometimes we really have to understand a person’s mindset when they’re going through this type of transition. Not only is it planning for your own career, what you’re going to do for your job, but it’s also thinking about shifting your mindset,” Robertson said.

“People that work at Diavik or even in Yellowknife, when we close, we’re not going to see each other every day. There’s a lot of shifts that we need to think about, that help build that resilience to move on.”

‘There’s a path forward’

Tłı̨chǫ Investment Corporation chief executive Paul Gruner said around 30 employees with the TIC are working on a contract with Diavik.

Though a “meaningful part” of revenue will be lost after the mine shuts, Gruner believes TIC will be able to make up for that loss by working with other mines and businesses like Ekati diamond mine, the reclamation of Giant Mine and De Beers to name a few.

“There’s a path forward in terms of how we want to find other meaningful employment for folks. It’s not that when the mine closes in 2026, all opportunities seize. There is another couple of years of opportunities that exist just from site clean-up,” Gruner said.

“We’re using our time wisely to build up those business opportunities … Looking at site sources, equipment, operations – these are all the areas we’re trying to move forward on some of the stuff.”

Gruner said they will have a better idea in regard to what Diavik’s closure plans look like next year.

“I think myself, the board, we’re confident that we have got time and that the opportunities will exist. Now it’s a matter of understanding closure plans by Diavik, understanding what those opportunities are at other site operations,” he said.

“This is going to be, sort-of the plan for 2025. It’s how we navigate that going forward … As we get more of the details and answer the facts on some of the stuff, it allows us to make more of a concrete plan.”

‘A learning curve’

While revenue from Diavik is also significant to Det’on Cho, chief operating officer Mark Lewis said they have been looking at opportunities to diversify the business over the last several years.

“We’re looking to find other ways to kind of replace those revenues once closure happens and clean-up is done,” Lewis said. “We’ve entered into real estate, we’ve purchased a waste management company, our logistics company is looking at an expansion in Saskatchewan.”

Lewis said 100 Det’on Cho staff work on-site at Diavik. He believes the mine’s closure would be a “learning curve” for everyone involved.

“Overall, it is going to be a loss of revenue for us. It’s going to be a bit of a new experience. We haven’t gone through, as a lot of the other businesses in the territory, one of these mine closures before,” he said.

“[We’re] looking at ways we can help alleviate that, whether its our own people that we have hired or members of the Yellowknives Dene First Nations community, who currently work there or potentially will be back in the community once the mine shuts down.”

What does “successful closure” look like?

Karen Costello, executive director of the NWT and Nunavut Chamber of Mines, said part of the mine’s legacy is “leaving a trained and experienced workforce” capable of taking on newer opportunities.

Diavik’s reclamation efforts and various partnerships with Indigenous businesses through the years, she said, is another aspect worth celebrating.

“The mining industry tends to be very mobile with workers. A person’s postal code is not necessarily a barrier to work outside of their home community,” Costello explained.

The regulatory system that northern mines abide by looks much different now. She said there is a requirement for companies to have a proper closure plan in place, “right at the very start.”

“Just the fact that the regulatory environment is different also puts the onus on the company to make every effort to execute a reclamation and closure plan,” she said.

“Mines now do active reclamation throughout operations. It actually makes sense from their perspective and for all of us, from a shared perspective, for progressive reclamation to occur while mining is also occurring.”

Costello pointed to some remediation efforts the mine has undertaken to ensure vegetation has the ability to grow back and wildlife can occupy the site again. As an example, she said the north country rock pile, intended to resemble an esker, has seen the presence of caribou this past spring.

“From what I have been able to observe from how Rio Tinto is doing it, they have been very open and transparent by engaging their partners on a regular basis,” she said.

“Just like the companies prepare for closure right from day one, there has to be a recognition that others need to prepare for closure as well.”