Ekati releases some severance cash, falls behind on regulatory work

Burgundy Diamond Mines, owner of the NWT’s Ekati mine, has pledged a partial payment to laid-off workers after missing the November 6 scheduled payout day.

Last week, Burgundy told workers there would be a delay to the severance payments they were due. The previous month, severance paid out amounted to only a quarter of what Burgundy had initially promised.

Now, multiple laid-off workers say they have been told a “partial severance payment of up to three weeks’ pay” will be issued on Monday, quoting an email update from Burgundy.

But the financially troubled company is starting to fall behind on other obligations at Ekati, which is one of three active diamond mines in the NWT and the only mine controlled by Burgundy.

Regulatory records show Burgundy wrote to the Wek’èezhìi Land and Water Board last month, asking for deadlines to be extended as it cannot pay the people doing the work on time.

“This request is necessary due to ongoing financial challenges that have delayed invoice payments to our consultants, which in turn have affected the progression of technical work required for these submissions,” Burgundy wrote.

Affected work includes a closure and reclamation plan for Ekati. That’s an important plan and previous versions have been criticized by regulators as too lightweight for the task.

Burgundy had a deadline of April 1, 2026 to submit a new version of the plan. Last month, the company asked the board for a new deadline of December 31, 2026.

“Due to the financial constraints outlined above, progress on these closure plans has slowed,” the company wrote.

“This additional time will allow us to resolve payment issues, conduct required workshops … continue engagement with our [impact benefit agreement] partners on closure criteria and complete the technical work required for these plans.”

The regulatory board approved Burgundy’s request for an extension last week.

“The board is disappointed that multiple extension requests continue to be required, and it is unfortunate that the licensee is in this situation,” it wrote in response.

“However, given the financial circumstances, the board has decided to approve the extension requests as submitted by Burgundy.”

Burgundy is attempting to finalize a huge cash injection from the federal government known as a large enterprise tariff loan, or LETL.

LETLs were announced by Ottawa in March as a response to US tariffs. A 50-percent US tariff on India, a diamond polishing centre, has affected Burgundy’s business, though that is only one factor affecting Ekati. Others include a natural diamond market depressed by the growth of cheaper lab-grown diamonds.

Burgundy is expecting to receive tens of millions of dollars from Ottawa. Due diligence is under way, and the company has suggested to the Australian Stock Exchange that it hopes to complete the agreement this month.

It sent a similar message to regulators last month, writing: “Burgundy remains committed to meeting all board requirements and providing quality submissions. We anticipate that outstanding payments will be addressed by the end of November, enabling our consultants to resume work on these deliverables.”