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Canada secures position as world diamond power Ekati, newly opened Diavik mines expected to claim 12% of rough gem production Gary Park Petroleum News Calgary Correspondent
Canada secured its place as a world diamond power July 19 with the official opening of the C$1.3 billion Diavik mine, which is expected to see billions of dollars worth of gems mined from under a Northwest Territories lake.
Along with Ekati, which went into production five years ago, Diavik is expected to vault Canada to third place among producers of rough diamonds.
The two mines will give Canada a 12 percent share of the market, moving it ahead of South Africa at 11 percent and behind only Botswana at 29 percent and Russia at 18 percent.
Diavik is a joint venture by British mining power Rio Tinto, with a 60 percent stake, and Vancouver-based Aber Diamond at 40 percent, while Ekati is controlled by Australia’s BHP Billiton.
Rio Tinto Chief Executive Officer Richard Clifford told the opening ceremony that the objective is to make Diavik “one of the safest, most productive and most profitable mines in the world.”
Diavik is also committed to filling 40 percent of its jobs with northern aboriginals under agreements signed with five Native groups — and is already at 38 percent.
Clifford estimated that northern firms landed contracts worth C$874 million during the construction phase, including C$604 million by aboriginal joint ventures or aboriginal-owned firms. Tiffany & Co. opens factory Other plays, including one by South African diamond giant De Beers for the Snap Lake mine in the Northwest Territories, hold out hope of value-added business in the diamond cutting and polishing business that has emerged in Yellowknife.
New York-based Tiffany & Co. has just opened a C$3 million factory in the Northwest Territories' capital and Aber has agreed to sell some of its stones to the jewelry firm. Aber Chief Executive Officer Robert Gannicott said the average value of diamonds mined at Diavik is US$90 a carat, but the average price for what is sold to Tiffany balloons to US$1,000 a carat.
There is also progress on the Blue Ice project on Victoria Island in Nunavut Territory.
Teck Cominco and Diamonds North Resources signed an agreement this month opening the way for Teck, the world’s largest zinc producer, to earn up to a 70 percent interest in Blue Ice.
Along with Teck’s C$1 million financing, the two companies will jointly fund a C$3 million exploration program on the property.
If Teck spends C$9.5 million over three years it will have the right to earn an initial 30 percent interest in the project — a stake it can grow in stages to 75 percent with additional spending and the completion of a bankable feasibility study.
Blue Ice covers 450,000 acres and is underlain by the Slave Craton which hosts the Ekati and Diavik mines.
So far, Diamonds North has discovered nine kimberlites, eight of which are diamondiferous.
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