Underground operations at the Diavik mine.

(IDEX Online News) – Dominion Diamond Corp appears unlikely to acquire Rio Tinto’s 60-percent stake in the Diavik mine in Canada’s Northwest Territories, according to comments by CEO Robert Gannicott.

 

Instead, the miner is concentrating on developing promising assets near the Ekati mine where it bought BHP Billiton’s 80-percent holding.

 

Industry speculation has suggested that Dominion would be the most likely buyer of Rio Tinto’s holding, particularly as it owns the other 40 percent of the Diavik mine.

 

However, it would only be interested in the stake at the best possible price from its point of view and on its terms.

 

"There's no point in buying things just to have more diamonds," Gannicott said. "If it's not going to deliver profitability, then I'm quite happy to stay where we are."

 

The acquisition is even less likely because Gannicott said that the firm would only be interested in the Diavik stake, whereas Rio aims to sell its diamond business as one unit. In addition to Diavik, Rio owns 100 percent of the Argyle mine in Australia, and 78 percent of the Murowa mine in Zimbabwe.

 

"We do not wish to purchase the entire unit, we're very focused on the Northwest Territories - the place we know, the place we belong and the place we understand," he said in a call to discuss Dominion’s results for the quarter ended April 30.