De Beers Puts Snap Lake Mine up for Sale
July 24, 16
(IDEX Online News) – De Beers announced that it has put its Snap Lake diamond mine up for sale, following its placement on care and maintenance in December, according to a report on Reuters.com.
In June, the company received permission to flood the underground tunnels at the mine in an attempt to reduce maintenance costs. De Beers has not begun the flooding process, and said that it would be prudent to see if other companies would be prepared to make an offer.
It spent C$2.2 billion ($1.67 billion) on mine construction and operation up to year-end 2014 and would like to find a buyer, but has not ruled out the possibility of going ahead with flooding the mine during the fourth quarter.
Snap Lake was De Beers’ first mine built outside of Africa, situated 220 kilometers northeast of the Northwest Territories’ capital, Yellow Knife. It is only accessible by air and an ice road that operates for two months of the year. Diamond recovery was hampered by groundwater problems, and at its peak employed 595 staff and 200 contractors before its suspension.
Potential buyers could include Stornoway Diamond Corp., whose Renard plant in Quebec is to shortly commence full production or Peregrine Diamonds Ltd., which is exploring for diamonds in Canada’s Arctic.