De Beers Takes Full Ownership of Gahcho Kue Mine
October 05, 26
(IDEX Online) - De Beers is to take full ownership of the Gahcho Kue diamond mine in Canada's Northwest Territories after financially troubled Mountain Province Diamonds agreed to transfer its 49% stake.
The agreement, announced October 1, gives De Beers 100% of the mine and releases Mountain Province and its subsidiaries from outstanding debts and obligations to De Beers under their joint-venture agreements.
Mountain Province's financial problems have been building amid the ongoing slump in diamond prices and demand. Revenue fell 42% in 2025 to $111.5 million from $195.2 million, while its average selling price dropped 18% to $59 per carat.
Mountain Province paused plans for the Tuzo Phase 3 expansion at Gahcho Kue because of market conditions. In April, S&P Global Ratings cut its credit rating to CCC-, warning of a high vulnerability to non-payment and a greater likelihood of a near-term default or debt restructuring.
The company was facing a $33 million working-capital facility and a $40 million bridge loan coming due, along with other financial obligations.
Mountain Province subsequently took measures to preserve cash. In June, it sold up to $5 million of future receivables from its share of Gahcho Kue diamond sales to Irish billionaire Dermot Desmond, a major shareholder in Scotland's Celtic Football Club, for up to $4.17 million.
It also deferred a payment into the mine's decommissioning fund and obtained extensions on other financial obligations.
Second-quarter results showed the extent of the pressure. Mountain Province reported a net loss of $86.9 million for the three months ended June 30, compared with $27.2 million a year earlier.
Although it sold more than twice as many diamonds as in the same quarter of 2025, the average realized price fell from $65 to just $36 per carat.
"This agreement follows an extensive review of the alternatives available to the Company against the backdrop of a material decline in diamond prices over the past year," said Jonathan Comerford, president and CEO of Mountain Province. He said the decline had been driven mainly by "tariff-related uncertainty and the conflict in the Middle East."
Comerford said the agreement "removes all liabilities, provides greater certainty for the employees and communities connected to Gahcho Kue, and preserves rights that allow Mountain Province to participate again in the mine's future."
Desmond had ploughed more than $176 million into Mountain Province through loans and other financial support, according to The Irish Times newspaper.
He also bought up to $100 million of Gahcho Kue diamonds that Mountain Province was unable to sell during the Covid-19 market shutdown, later selling them when the market reopened.