Ekati owner Burgundy says the NWT diamond mine’s entry into receivership – bringing its operations to an end after nearly three decades – is a “deeply disappointing outcome.”
A court ordered the mine into receivership on Tuesday at the GNWT’s request. Arctic Canadian Diamond Company, a Burgundy subsidiary, ran out of money and no buyer could be found.
The territorial government has said shutting the mine down and beginning reclamation will take about five weeks. More details about that process, to be managed by insolvency firm PricewaterhouseCoopers, are expected at a briefing later on Wednesday.
The NWT government said Burgundy had agreed with the decision to request that the mine be sent into receivership.
Burgundy did not respond to a request for comment from Cabin Radio. In a statement issued to the Australian Securities Exchange, the Perth, Australia-based firm did not confirm it backed the decision but acknowledged its subsidiary “had no available funding pathway to maintain operations.”
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“This is a deeply disappointing outcome for Ekati’s workforce, Burgundy’s stakeholders and communities across the Northwest Territories,” Burgundy chief executive Jeremy King was quoted as saying.
“Ekati has made an extraordinary contribution to the Territory for more than 25 years as a major private-sector employer and through its longstanding relationships with Indigenous communities and local businesses.”
Burgundy said it would now “assess the implications” of the mine entering receivership, including its obligations to the federal Canada Enterprise Emergency Funding Corporation, which spent the past year giving the company a series of loans worth nearly $200 million to keep it afloat. How much of that can be repaid is not clear.
“Burgundy will provide further updates in accordance with its continuous disclosure obligations,” the statement concluded.
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Remaining workers at Ekati are expected to lose their jobs, though the years-long remediation process will undoubtedly create work.
The Union of Northern Workers expressed frustration on Tuesday that the mine’s entry into receivership had taken it by surprise.
“Our members’ severance is at the bottom of the creditor payment list,” UNW president Gayla Thunstrom said in a statement.
“This further highlights how current laws and legislation are intended to protect corporations over people and workers – at the expense of the workers’ rights, despite these workers being the backbone of these corporations.”
In a statement of her own, NWT industry minister Caitlin Cleveland said she recognized workers and businesses affected by Ekati’s closure could not be “left to navigate this alone.”
“The GNWT will help impacted workers and businesses access available supports, services and opportunities,” Cleveland stated.
“The GNWT is also committed to supporting northern workers, contractors, suppliers and local businesses. We have communicated the importance of continued northern and Indigenous participation to the Receiver, and will continue to advocate for northern and Indigenous workers and businesses to be involved to the greatest extent possible as the site moves into care and maintenance, reclamation and closure.”
The federal government has yet to comment on the mine’s closure in the face of Ottawa’s financial efforts to prop it up.
The federally backed agency that gave Ekati multiple loans previously said it was doing so to “help stabilize a major Canadian player in the global diamond industry amid current tariffs on the diamond market.”
While tariffs were a factor, the global market for natural diamonds has more broadly sagged to the extent that De Beers suspended work at South Africa’s biggest diamond mine this week. Lab-grown diamonds have increasingly eaten into natural diamonds’ market.
