According to both Finance Minister John Todd and federal-territorial diamond task force co-chair Joe Handley, the NWT cabinet has given the OK to purchase up to 10 per cent of the annual production from BHP's Ekati mine.

Todd said the government is willing to pay the same price BHP would charge De Beers, the international diamond marketer.

Though the federal government has been lukewarm to the idea, Handley said there's no shortage of interest in Northern secondary diamond industry from business.

As deep as its pockets are, the government has yet to convince BHP to sell it a slice of the pie.

"We've told the territorial government we would prefer not to sell diamonds to a government agency or to arms of government," said BHP spokesperson Graham Nicholls.

Nicholls said BHP has yet to see a business plan to support the buy, or hear what organizations the government would partner with to finance the buy.

"We want a successful business relationship with any customers," said Nicholls. "If we're selling to entities that don't have background or experience in this area, it won't be a successful venture."

Todd agreed the government will have to work hard to convince BHP it is capable of handling the load.

"We've got to negotiate with industry and give them confidence we will act in a business-like manner," said the finance minister.

He added that another reason for getting hold of a supply of rough diamonds.

"I see it as a policing mechanism," said Todd. "It gives us an opportunity to make sure we get an accurate valuation."

Though Nicholls said BHP has no interest in discussing its concerns about a deal with the government in the media, Handley speculated that one may be the territorial government's ability to establish a secondary industry that can move the diamonds.

"They're concern, probably, is that we might end up with more than 10 per cent on hand," said Handley.

Handley said if the government was to buy 10 per cent of the mine's production, some would have to be sold on the market until the secondary industry developed enough to absorb the supply.