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Dominion Diamond Mines is a Canadian diamond mining company with ownership interests in two major producing diamond mines situated approximately 200 kilometers south of the Arctic Circle in Canada’s Northwest Territories. The Company operates the Ekati Diamond Mine (in which it owns a controlling interest), and also owns 40% of the Diavik Diamond Mine. It supplies rough diamonds to the global market through its sorting and selling operations in Canada, Belgium and India and is Canada’s largest independent diamond producer.
Ekati Diamond Mine
The Ekati Diamond Mine (named after the Tlicho word meaning ‘fat lake’) is Canada’s first surface and underground diamond mine. It officially began production in October 1998, following extensive exploration and development work dating back to 1981. Like Diavik, the Ekati mine site is located in the Lac de Gras region of the Northwest Territories, approximately 300 kilometers northeast of Yellowknife.
The Ekati mine is renowned for the premium gem quality diamonds it produces. The largest gem quality diamond produced to date at the mine is a 186-carat diamond from the Pigeon pit, which was recovered and sold in 2016. Cumulative production to January 2017 has totalled approximately 67.8 million carats.
The Company operates the Ekati Diamond Mine in which it owns a controlling interest. Over the mine’s early years, production was focused on six open pits and two underground operations. The current Reserves Base Case Mine Plan is based on production from six kimberlite pipes: Misery Main, Pigeon, Sable, Lynx and Jay open pits, and Koala underground operations. Currently, Koala, Misery Main, Pigeon and Lynx pipes are being mined. Mining has not yet commenced at the Sable or Jay pipes. In addition, the Misery South and Southwest satellite material is being excavated as part of the Misery Main mining operations. This material is being stockpiled separately and is planned to be processed through the Ekati plant as a supplement to the Reserve Base Case Mine Plan, which we refer to as the Operating Base Case Mine Plan. The Ekati process plant has the capacity to process 4.3 million tonnes per year. Additional feed from Coarse Ore Rejects will be used to supplement mined ore. This material is not included in the reserves or resources and is therefore incremental to production.
Jay was approved for construction by the Company in July 2016 and is the most significant undeveloped deposit at Ekati due to its large size and high grade and extends the mine life by approximately 10 years to 2033. The Company’s timetable for the development of Jay assumes the start of road construction in 2017, dike construction in 2018-2020, dewatering and start of pre-stripping in 2021, and mining and processing of Jay kimberlite by late 2022.
As of January 31, 2017, the Ekati Mine is reported to contain 26.0 million carats of probable reserves in the Core Zone and 79.4 million carats of probable reserves in the Buffer Zone for a total of 105.4 million carats of total probable reserves (on a 100% basis).
Diavik Diamond Mine
The Diavik Diamond Mine is Canada’s largest diamond mine in terms of carat production. Diavik was established following the discovery of four diamond-bearing deposits, called kimberlite pipes, in 1994 and 1995.
The mine site is located in Canada’s remote wilderness on a 20 square kilometer island, at Lac de Gras, Northwest Territories, approximately 300 kilometers from Yellowknife, the territorial capital, and just 220 kilometers south of the Arctic Circle.
Diavik began producing diamonds in January 2003, and the Company sold its first rough diamonds in March that year. Diavik diamonds are highly regarded in the international commercial marketplace particularly for their white colour and good clarity. Diavik’s exceptional grades make it one of the most valuable diamond mines in the world.
Dominion Diamond Mines does not operate the Diavik Diamond Mine. The mine is operated by Diavik Diamond Mines (2012) Inc., a subsidiary of Rio Tinto plc, one of the world’s largest and most highly regarded mining companies. Under the joint arrangement, Rio Tinto operates the mine and Dominion Diamond pays 40 per cent of the mine’s operating and capital costs while receiving 40 per cent of the mine’s diamond output.
The mine plan is built on four diamond-bearing kimberlite pipes. The three kimberlite pipes currently being mined, A154 South, A154 North, and A418, are very high grade. The fourth pipe, A21, is currently in development with the first kimberlite production anticipated by the end of 2018. As of December 31, 2016, the Diavik Mine had 26.4 million carats of proven reserves and 19.5 million carats of probable reserves for 46.0 million carats of total proven and probable reserves (reserves are for 100 per cent of the Diavik Mine, in which the Company has a 40 per cent ownership interest).
The current mine plan is expected to take the mine’s production to 2025.
Diamond Sorting & Selling
The Company maximizes the sales value of its rough stones from the Diavik and Ekati Diamond Mines and maintains a preferred position as a supplier of rough diamonds to the world’s diamond manufacturers (cutters and polishers) by dealing directly with them and tailoring rough diamond parcels to the client’s particular needs.