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Who discovered the Gahcho Kué deposit?
Does Mountain Province Diamonds have any obligation to fund exploration or construction?
Is Mountain Province involved in the exploration and operations?
What will Mountain Province's share of expenses be when construction is complete?
What has been the reaction of the local community to this project?
What will be the impact of the project on the economy?
In January 1995, Mountain Province discovered the 5034 pipe. In mid-1997, after partnering with De Beers, the Joint Venture found the Hearne and Tuzo pipes.
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No. Mountain Province has a free carry through to production. Since March 2000, De Beers has been solely responsible for the financing of the exploration of the project. Under the Joint Venture agreement, De Beers will increase its ownership position in Gahcho Kué from 51% to 55% by funding the bankable feasibility study. Upon completion of the study, De Beers can increase its position to 60% by funding construction of the mine, which is expected to cost C$825 million.
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Yes. De Beers Canada is the operator of the project, but the Joint Venture Management Committee reviews and approves business plans and operating budgets.
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Once production begins, De Beers has the right to recover that portion of the project expenses carried on behalf of Mountain Province from 90% of the cash flow with the remaining 10% being distributed to the partners in proportion to their interest in the Joint Venture. Following recovery of the capital, Mountain Province will receive 40% of the operating profit.
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The local community has been very supportive. Lessons learned from the development of the diamond industry in the Northwest Territories and the knowledge of northern Aboriginal people have been incorporated into the Gahcho Kué project by involving members of the community in the project's development.
De Beers Canada aims to develop a project which will bring lasting benefit to the region and which will contribute significantly to the sustainability of the diamond industry in Canada, and specifically in the Northwest Territories.
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Gahcho Kué is expected to be the fifth diamond mine to come into production in the Northwest Territories. The development of this project will be a significant contributor to the local economy. De Beers Canada estimates 600 workers will be needed to construct the mine, and 250 will be needed to operate it. De Beers intends to build accommodations, power, telecommunications, water treatment, water disposal, roads, storage and more.
The diamond industry has become an integral part of the economy of the Northwest Territories, creating more than 1,700 jobs and contributing to a significant increase in GDP.
The Ekati and Diavik mines have developed reputations for exercising a high level of environmental stewardship. They have contributed to the Northwest Territories by providing community support, employment and business opportunities. In addition, they have helped create additional spin-off jobs in the downstream industry of cutting and polishing. The Northwest Territories has moved beyond the role of diamond producer to developing a vibrant secondary diamond industry.
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