Canada's First Diamond Mine to Shut, Owners Enter Receivership

(IDEX Online) - Burgundy Diamond Mines, owners of Ekati, are to enter receivership after running up debts of over $280 million and failing to find a buyer for Canada's first commercial diamond mine.

The Supreme Court of British Columbia placed its subsidiary Arctic Canadian Diamond Company, operator of the mine, into receivership on 14 July.

The mine, which opened in 1998, will cease operations and the remaining 350 workers will be laid off.

The closure is a significant blow for workers and the Northwest Territories (NWT), where Ekati has long been a cornerstone of the private-sector economy and a major source of employment.

The mine had been expected to run until 2029, but weak diamond prices, competition from lab-grown stones, and funding problems forced a premature shutdown.

NWT officials have warned that the early closure raises difficult questions about the future of the region's diamond industry and the fate of hundreds of specialized workers.

In a statement posted on the Australian Securities Exchange, Burgundy's CEO Jeremy King said the mine closure was "a deeply disappointing outcome for Ekati's workforce, Burgundy's stakeholders and communities across the Northwest Territories."

"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."

Receiver PricewaterhouseCoopers Inc. is now overseeing an orderly wind-down of operations and the transition to care and maintenance, reclamation and closure.

Pic of Ekati mine, courtesy Burgundy Diamond Mines.