PwC accused by regulator of ‘direct non-compliance’ at Ekati

PricewaterhouseCoopers, the receiver appointed to oversee closure of the insolvent Ekati diamond mine, has been accused of “direct non-compliance” by an NWT regulator.

In a letter late last week, Wek’èezhìı Land and Water Board chair Mason Mantla asked territorial environment minister Jay Macdonald for an urgent meeting about the situation.

Mantla said the land and water board had provided “clear direction” that PwC should not allow emulsion to be disposed of in a specific containment facility, but PwC had carried on doing so.

“The Board instructed PwC not to continue this unauthorized disposal and PwC did not abide by this decision,” Mantla wrote.

“The Board could consider the suspension of the Water Licence for the activities at the Ekati Mine given this direct non-compliance with Board direction.”

A water licence is a key regulatory document that helps set out how industrial sites are expected to mitigate their impact on the environment.

Mantla asked Macdonald for a meeting this week and also requested a raft of information about the GNWT’s interactions with Ekati owner Burgundy and receiver PwC – including how government inspectors have communicated with the mine over the past 18 months.

According to the land and water board, PwC said an inspector had told staff that dumping the emulsion was OK. PwC also asserted Ekati had been dumping emulsion this way for more than a year, the board added.

PwC did not respond to a request for comment.

The GNWT acknowledged Macdonald had been invited to a meeting but did not make him available for interview.

Meetings “are being organized to discuss the concerns raised and how they will be addressed moving forward. We look forward to this conversation,” Macdonald was quoted as saying in a written statement.

“Given that this process is underway, it would be premature for me to comment further on these matters before those discussions have taken place.”

Missing data, abandoned emulsion

The backdrop to this flashpoint between the receiver and regulator is Ekati’s steep descent from economic pillar to environmental liability.

The mine ran out of money earlier this year and no buyer could be found, leading to the GNWT appointing PwC in July. The receiver’s instructions are to close the mine in an environmentally safe manner using the hundreds of millions of dollars held by the GNWT in security payments from Ekati’s prior owners. (Whether that cash will be enough remains a matter of debate.)

No final closure plan is in place.

PwC is no stranger to this kind of situation. It was also made the receiver of Yukon’s Eagle Mine after a catastrophic heap leach landslide and cyanide spill in 2024, for example. But it is a stranger to the NWT’s regulatory environment.

“The whole system here in the Mackenzie Valley region of the Northwest Territories is so much different, so it’s not surprising they’re not used to that level of oversight,” said Ryan Fequet, the Wek’èezhìı Land and Water Board’s executive director. “But it certainly does not mean they can disrespect it.”

“Calling the minister into the principal’s office is not something the board takes lightly, and it’s meant to [convey] a sense of the urgency,” Fequet said.

“What we’re talking about is an ‘oops,’ but it’s a disposal of waste in the receiving environment – literally the worst thing, that the board never wants to see.”

While the emulsion issue is a high-profile matter, it is far from the only live issue as PwC works to get on top of what was, until recently, a working mine that wasn’t supposed to close this summer.

In other documentation published to a regulatory registry, PwC says it cannot supply any 2025 aquatic monitoring data because the contractor who did the monitoring was never paid and won’t hand it over.

PwC says it “has no allocated funding to discharge pre-receivership debts,” so that data is essentially lost.

Meanwhile, territorial government inspectors found concerns in their most recent visit to the mine, including ammonium nitrate – an agent in industrial mining explosives – drifting loose from a containment facility.

That’s not the only explosive substance out of place.

Some 19 tonnes of explosive emulsion is set to be left below ground at the Misery underground mining area of Ekati, because it was loaded into blast holes but never used before mining stopped. PwC says going back for it is too dangerous.