Lacking local support, De Beers shelves Ontario diamond mine expansion

Tue Feb 7, 2017 11:41am EST
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By Susan Taylor

TORONTO (Reuters) - De Beers is shelving immediate plans to study an expansion project at a remote northern Ontario diamond mine after failing to get support from a neighboring aboriginal community, a "disappointing" setback for the world's top diamond producer, the mine's manager said.

The isolated Victor mine in the James Bay lowlands produces some 600,000 carats of diamonds annually and is scheduled to stop production in late 2018 and close in early 2019, De Beers Canada general manager James Kirby told Reuters late last week.

The nearby Tango deposit could have added five or six years, but assessment work will not proceed without formal support from the First Nation of Attawapiskat, 90 kilometers (56 miles) east of the mine, Kirby added.

Attawapiskat Chief Ignace Gull, elected last summer, did not respond to requests for comment.

The community of about 2,000, which has grappled with such challenges as inadequate housing and flooding, last April declared a state of emergency after a wave of suicide attempts.

It has had a rocky relationship with the company, reflecting concerns over economic and environmental issues, blockading the mine access road in 2013.

Talks resumed only in recent weeks and did not make progress on Tango, said Kirby, who manages Victor.

To determine if Tango is economically viable, the miner needs 100 days in winter to extract a bulk sample from the frozen wetlands.   Continued...