Dominion Diamond Mines has completed the sale of the Ekati mine in Canada’s Northwest Territories to a newly created company, Arctic Canadian Diamond Co.
The sale has allowed the mine, which has been on care and maintenance since March 2020 because of the COVID-19 pandemic, to reopen. Ekati initiated a 10-week phased restart in November 2020, and returned to full operations on Jan. 20. It is expected that all employees will return to work no later than Feb. 25.
Rory Moore, who has served as Dominion’s vice president of exploration since 2018, has been appointed Arctic’s interim president.
“We are excited to have our employees back at work and to have Ekati in full production again,” said Moore in a statement. “This new partnership will bring fresh perspectives to our operations and be the driving force behind our continued growth.”
Arctic was formed and is owned by three investment companies—DDJ Capital Management, Brigade Capital Management, and Western Asset Management Co.—two of which are significant Dominion bondholders. Last year, the three companies halted a bid from Dominion’s former owner, Washington Companies, to repurchase the company.
The Alberta Court of Queen’s Bench approved the sale on Dec. 11, seven months after Dominion filed for protection for insolvency.
The sale does not include Dominion’s 40% stake in the nearby Diavik mine, which Dominion runs with Rio Tinto.
As part of the sale, Arctic will receive a new $85 million fully funded working capital facility.
“This transaction significantly reduces our debt obligations, and provides sufficient liquidity to fund our operations, invest in future growth, and allow the company to emerge with a materially stronger balance sheet,” said chief financial officer Kristal Kaye in the same statement.
Ekati is Canada’s oldest diamond mine, having begun production in 1998. It is generally credited with sparking Canada’s diamond rush.
Top: An aerial view of the Ekati mine (photo courtesy of Dominion Diamond Mines)Follow JCK on Instagram: @jckmagazine
Follow JCK on Twitter: @jckmagazine
Follow JCK on Facebook: @jckmagazine