Ekati ‘would have been a closure’ without loan, northern MP says

Put forward as Ottawa’s spokesman, Yukon MP Brendan Hanley told Cabin Radio Ekati’s $115-million federal loan came at a fork in the road with the mine on the brink.

Hanley, who is not normally the government’s face on major NWT initiatives, is the parliamentary secretary to northern affairs minister Rebecca Chartrand and was briefed on the deal.

He happened to be in Calgary, where Ekati owner Burgundy has its Canadian headquarters, as the NWT diamond mine’s loan was finalized.

In an interview, Hanley said a nine-figure taxpayer-backed loan was justified to keep Ekati’s workforce in place as the territory transitions to other economic drivers like critical minerals, Arctic sovereignty and related infrastructure projects.

“We need this workforce,” he told Cabin Radio. “We have a future for industry in general, even as we know there are these more immediate threats to the diamond industry. So it really makes sense to keep this industry operating.”

Below, read a transcript of our interview with Hanley. You can also read our main coverage of the loan and a separate transcript of our interview with Burgundy boss Jeremy King.

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This interview was recorded on December 16, 2025. The transcript has been lightly edited for clarity.

Ollie Williams: This is obviously a huge intervention. What justified this level of intervention with Burgundy?

Brendan Hanley: It is a big intervention. This is a big deal for the North – obviously a big deal for the Ekati mining company, but also for all of the people who are employed and now will have an ongoing chance to maintain employment. It’s a big deal for Canada as well.

We know diamond mines in the Northwest Territories are facing multiple pressures. We know that ultimately they are looking in the next few years towards closure as the ore availability lessens.

But there have been such significant pressures in the shorter term – market instability, the influence of synthetic diamonds, and most notably direct tariff encroachments, you might say, or tariff threats, but also the indirect uncertainty and its effect on the market, just due to the climate of tariffs. These more recent threats have really threatened the viability of Ekati to continue.

Thus the Burgundy application for this LETL financing, to allow it to continue operations and allow it to continue employment in the sector.

You outlined a list of factors there, few – if any – of which look like they’re going anywhere. Let’s take lab-grown diamonds. They’ve eaten into the market and there doesn’t seem to be any sign that’s going to slow down. Tariffs, who knows? What has convinced the federal government – bearing in mind this is a loan of $115 million – that it’s going to get the money back?

This is a time when the Government of Canada recognizes the need to step up and show we are there for workers and we are there for industry in this time of huge threat, but also of transition.

There are so many opportunities for the North and for mining in the North. The federal government’s approach is: look, we’re in this important transition period where we need those skilled workers. We need to maintain productivity, because we’re positioning the Northwest Territories in this case – but really across the territories – [for] critical minerals, defence investments, economic development with emerging opportunities from development corporations and growing industry opportunities as we look to securing Canada’s North. Investments in Arctic infrastructure.

We need this workforce. We have a future for industry in general, even as we know there are these more immediate threats to the diamond industry. So it really makes sense to keep this industry operating, to keep it viable while we work on the longer term together, with Indigenous governments, with territorial governments, with the federal government and with industry, to map out the longer term for industry viability in the North.

Is it fair for me to paraphrase that as: “We don’t know if we’re going to get our money back, but we couldn’t sit there and do nothing and let that workforce ebb away.”

Certainly, there’s a choice. There’s a fork in the road, you might say. We could do nothing and just let market forces determine the future. But we could say: look, we are confident enough in the future viability of the North – facing incredible challenges but also incredible opportunities. This is actually a time to lay down some money.

A loan always comes with risks, yes, absolutely, but we’re also confident enough in the future viability of industry in the North that that might be linked to defence investments, that might be linked to critical minerals and to the supporting infrastructure. This is the reason that this $10-billion fund was created, the LETL, in order to support industries through a very uncertain time – wherever they are, but definitely including Canada’s North.

The boss of Burgundy said this isn’t a bailout, it’s a commercial deal. Now, there were no other private-sector firms or banks prepared to come in and help. The government has said, “OK, we’ll step in.” Is that a bailout to you?

To me, this is the role of government, where government has a role that private industry may not.

Government will take on added risk because as government, we can see a larger picture here, and we can see there is a need to invest in our skilled workers in the North and all of the benefits that industry brings. These are skills that can be applied across a whole range of other industries, even while we see the eventual demise of diamond mining as a viable industry in the North.

But it’s also saying we have confidence in the future economic viability of investing in the North. Really, I think it is a different equation when it comes to government intervention.

Can you give me any specific examples of the accountability measures in this agreement to ensure Burgundy does what the government wants it to do with that money?

I cannot. I’m not privy to that information, unfortunately. I am confident that maintaining employment will be one of those premises of the loan.

The only other LETL to date was for Algoma, the steel giant. It was a $400-million loan. Within weeks of that coming out, Algoma issued hundreds of layoff notices, so clearly that did not protect those jobs. Is that something that should happen with these LETLs? Are there guarantees that Burgundy won’t do the same thing with the same money?

We will learn more. And again, I’m not privy to what was written into the contract. Obviously, lessons learned from Algoma. But also I think the premises are very different. In the case of Algoma, we’re saving the industry – saving the company from what would have been a shutdown.

Is that not exactly what you’re doing here?

In this case, we are definitely protecting industry, but we are protecting workers. We are protecting jobs and workers and saving that saving that skilled labor, not only for the immediate future, but for the longer term.

The boss of Burgundy said Ekati will be a smaller mine than it was before, it’ll have fewer workers. So we’re only protecting some of the jobs. Did you know that?

So again, I’m not privy to the conditions. What I know is this is a significant investment to protect a really crucial industry at a really important time.

There’s a quote in the news release that accompanies all of this that says this buys the Northwest Territories some time to diversify its economy and figure out where we go next. The problem with that, as I think you’ll understand as a northern MP, is the North has waffled on about diversification for a really long time. This loan would appear to be evidence that we haven’t really done it. What comes with this loan in terms of any added momentum or creative thought at all to actually get us to diversify?

Well, you know, the pressure is definitely on. We are now part of a government that is moving fast, a new federal government with a mandate to protect Canada’s economic sovereignty in the face of US threats.

This is an example embedded in the North where the onus, yes, is on us to work together to come up with those transition solutions.

We recognize there’s a lot of work to do and the time horizon has shrunk from some kind of nebulous future to we need to step up and protect Canada’s economic sovereignty now.

I think I’m looking forward to seeing an accelerated pace that includes, of course, the appropriate consultations, the appropriate assessments, and also the opportunities for Indigenous partnership.

What are the federal government’s expectations for Burgundy now? Is it a case of reopen the mine and get it back up to full speed within a certain amount of time?

The main thrust of this is continued operations. This provides Burgundy with the means to continue operations, to continue employment, and allows time for that eventual transition that we’re all looking forward to in the North.

But this really allows prevention of what would have been a closure, an accelerated closure. This gives us the time to make that proper transition, to retain the skilled workforce and to maintain jobs and economic productivity.