Diamond Slowdown: Expansion at Gahcho Kue is "Paused"

 

Mountain Province Diamonds (MPD) say it has “paused” plans for a key expansion that would have prolonged the life of its Gahcho Kue mine in Canada’s Northwest Territories.

MPD, together with De Beers, its joint venture partner, say “current market conditions” are to blame.

In a corporate update published on 13 February they say plans for Tuzo Phase 3, an open pit project targeting high-value kimberlite, is being put on hold.

Planning and early studies have been completed, but major physical development has not yet started.

“The partners remain committed to responsibly managing operations at the Mine and will continue to monitor market conditions to determine the optimal timing for any future development of the Tuzo Phase 3 project,” MPD said in the update.

The postponement will not impact production or sales in 2026, it said, as mining continues at the NEX pipe.

MPD is due to issue its Q4 2025 production and sales figures later this week, along with its guidance for 2026.

Postponing Tuzo Phase 3 avoids major capital expenditure but could shorten the life of the mine.

MPD must meet its 49 per cent share of joint venture cash calls totaling CAD 49.2m (USD 36.1m) for Gahcho Kue operations, with the first payment due next month

The project was designed to sustain operations from roughly 2027 through 2030, with ore processing extending to 2031, building on earlier plans that already pushed the mine life to 2031 via pit optimizations.

Source: DCLA

Canada's Big Three Mines Could Close Early

Canada’s three biggest diamond mines could be forced to close early, an economist has warned, amid the ongoing slump in prices.

Operators reported losses last year for Diavik, Ekati and Gahcho Kue, all in Canada’s Northwest Territories (NWT).

They are slated for closure as they reach the end of their lives – estimated at 2026, 2029 and 2030 respectively – but dwindling demand may render them uneconomic before those dates.

Graeme Clinton, an economist in Yellowknife, capital of NWT, told CBC, Canada’s national broadcaster : “I don’t think nearly enough is made of the state of the markets which are most important to our economy. These low prices could very well mean an early closure.”

He qualified his comments by saying that none of the miners had so far indicated that they’d bring forward their closing dates.

Diamond mining is key to NWT’s economy, representing over a quarter of its GDP, but miners have been hit hard by the downturn.

Rio Tinto’s Diavik mine lost CAD 127m (USD 94.6m) in 2024, Burgundy’s Ekati lost CAD 94.7m (USD 70.5m) and Mountain Province, minority-owner of Gahcho Kue lost CAD 81m (USD 60.0m).

Early closures would cost thousands of jobs, and would dent NWT’s economy.

Source: DCLA