Ekati diamond mine owner Burgundy says it can now access up to a further $60 million in federally backed loans to keep the mine running.
That’s on top of an initial $115-million loan announced in December.
The money comes from a tool created by Ottawa known as a Large Enterprise Tariff Loan, designed to help big companies get through economic difficulties at least partly created by tariffs like those being imposed by the United States.
The Canada Enterprise Emergency Funding Corporation – which administers these loans – still displays only the $115-million figure on its loan approvals page. (After this article was first published, the CEEFC directed Cabin Radio to an announcement confirming the expanded loan, though it contained no additional information.)
American tariffs on India have disrupted the diamond industry, which relies on India as a central hub for diamond polishing and preparation.
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“This additional funding will help Burgundy and Ekati continue operations and navigate the current highly challenging environment for natural diamond markets,” Burgundy boss Jeremy King was quoted as saying in a statement on the company’s website last week that was not circulated to northern newsrooms.
“As we look to advance our work at Sable pit, Misery underground and Fox pit, the expanded $60 million in funding will enable Ekati to meet its goals, while strengthening the foundation for future success,” King’s statement continued.
King previously said Ekati would be a smaller mine than in its heyday as the company cuts back to remain viable.
Aside from tariffs, the natural diamond market is also being hit by the emergence of cheaper, lab-grown diamonds and a drop in consumer demand in nations like China.
Though the diamond industry has been at the heart of the NWT’s economy for two decades, the initial $115-million loan to Burgundy – which the company insisted was not, in essence, a bailout – has been greeted with skepticism in some quarters.
Some NWT politicians have suggested the money may have been better spent in sectors with brighter long-term prospects.
